Time to rid the blinders about NordStream

The Swedish government's decision to accept the disputed gas pipeline NordStream has caused debate. Is the Russian-German gas pipeline a security policy threat to vital Swedish interests? Or is it a project that safeguards stability and development in Russia? In a recent interview by Andreas Henriksson from political web journal makthavare.se, I try to put some of these questions into perspective.

Vilhelm Konnander participated as one of the lecturers at the Fokus magazine conference "When technology changes politics" a few weeks ago, where he spoke at the Global outlook seminar. He is also one of the authors of the international blog gateway Global Voices, and has both professionally and privately followed developments in Russia for a long period of time. Makthavare.se asked him to give his views on the gas pipeline, and also account for the role that Russian gas and oil giant Gazprom plays in current Russia.

Q: How do you think that the Russian political leadership looks at the gas pipeline? Is it an important project for them from a strategic and geopolitical perspective, or is it a more downright economic project that carries its own merits and might have fallen had Swedish resistance been to great?

A: It is time to rid ourselves of blinders concerning the Nordstream issue. For Russia, NordStream and energy exports is a classical question of domestic foreign policy. It is about fattening a system that rests on a far-reaching political and economic symbiosis between competing political and economic élites, which seek to monopolize political and economic power. And the loyalty of élites is dependent on the incomes from oil, gas, and other raw materials, and how these profits are divided.

Extenstive regulations, taxation, and charges on the domestic market, has put the Russian energy industry in a position where the largest profits are made on foreign markets. For example, the internal Russian price on gas has, at times, been as low as a mere 3 percent of the export price. In the course of time, Gazprom's export incomes have varied between 50 and 70 percent of the business conglomerate's total revenues, despite the fact that substantially lower gas volumes have been delivered to Europe than to the domestic market. The Russian élites have thus enveloped itself into a so great dependency to divide the spoils of energy export revenues that it has become an integrated part of the country's informal system of government.

Q: And what would be the consequences of that?

Today, Russia's political stability is dependent on stable energy export revenues. In the event that this money flow is stopped - especially in times of economic crisis - it may subvert or threaten the political stability of the country.

The link between falling energy prices and Russian systemic collapse is obvious, regardless of whether one speaks of the fall of the Soviet Union or the financial crisis in the wake of which Putin came to power. Therefore, the effects of the international financial crisis is now all becoming resemblant of a fight for life or death to get hold of a piece of an ever diminishing cake. The consequences of Russian domestic political instability are still unclear, but increasing Russian desperation might cause greater uncertainties in the foreign and security policy area - in contrast to the clarity and predictability of recent years.

Q: What then might we expect from or great Eastern neighbour in the future?

A: In this perspectve, NordStream is, of course, important, but a basic mistake from the Swedish horizon is to constantly depart from very obscure geopolitical perspecitve, at the same time as the fundamental Russian domestic motives behind the project either are put in the background or regarded as purely economic.

In the interplay between politics and business, NordStream and similar projects are strategically vital for Russia, and here the domestic driving forces marginalise any potential foreign policy considerations - especially concerning a country like Sweden, which is hardly visible on the Russian political map. Continued Swedish resistance to NordStream would therefore be regarded as a ridiculous source of irritation from a Lilliputian country in the European periphery.

Q: In Sweden, NordStream has been thoroughly discussed, mostly from a critical perspective, by representatives of both the political blocs. Do you think that the NordStream management - and consequently the heavy political actors behind i in Russia and Germany - have paid any attention to Swedish critique, or would they have built the pipeline no matter what the Swedish government would have thought and said?

A: That Russia and Germany would have shown any greater consideration of Swedish critique is not very probable. Some considerations may well be made as for the stretch and makeup of the gas pipeline, and Sweden may surely also grumble and protract the issue if desired, but eventually both Moscow and Berlin counts on the Swedish government coming around. It is one thing if Sweden throws gravel into the Russian machinery, but to oppose both Russia and - above all - Germany will prove difficult in the long run.

Q: How important is NordStream, in your opinion, to Germany?

A: All since Willy Brandt's Ostpolitik was launched in the 1970s, Berlin and Moscow have enveloped into a mutual dependency according to the formula "change by rapproachment," where gas deliveries to Germany has become the basic ingredient in the political concepts of both continental powers.

Even if Angela Merkel's (the German Chancellor) enthusiasm towards the project is more controlled than her predecessor's , Gerhard Schröder, who by the way is on Gazprom's payroll, the realization of the gas pipeline is central to future German-Russian cooperation. That Germany, in current times of economic crisis, would terminate a project, which ensures long-term, secure, and cheap gas deliveries, would be very surprising - both from a political and a financial perspective.

Q: How politically directed is the Russian gas and oil giant Gazprom?

A: The question should perhaps rather be how economically directed the Kremlin is by Gazprom. That both Russia's president, Dmitry Medvedev, and on of the country's previous Prime Ministers, Victor Chernomyrdin, have been chairmen of Gazprom should be a clear indicator. Despite privatization attempts during the 1990s, Gazprom has remained a state gas monopoly with great influence on political power. With increasing political control over so called strategic resources, Gazprom has served as a tool for quasi nationalizations of remaining private gas and oil companies, why its position has been all the more strengthened. The question about Gazprom and the Kremlin is like tha classical question about the hen and the egg: Which one came first?

Q: To what extent would you say that Russia is using its great oil and gas resources as an instrument of foreign policy power?

A: Rhetorics about Russa as an energy superpower have, in recent years, almost become a mantra for Russian leaders, as a way of strengthening national self-images and confidence. However, judging from results, it is hard to show that Moscow is using energy as a direct foreign policy tool. Seen frlom an economic and domestic political viewpoint, the energy issue is, however, currently part and parcel of almost all Russia's conflicts with its neighbours in recent years - Estonia, Ukraine, Lithuania, and Georgia.

What is interesting is, however, to look at how Moscow indirectly uses energy as a means of strategic manipulation. With the help of energy, foreign policy advantages and concessions are simply achieved in other areas than exactly the one that each conflict focuses on. Energy is used indirectly rather than directly as a foreign policy tool, where domestic politico-economic considerations often determine foreign policy action.

Q: What do you think about the Swedish debate about NordStream? Is it substantially mostly correct or is it mared by antiquated Swedish fears of the Russians?

A: When Nordstream is addressed in Swedish debate, it is not hard to make up an image of a security policys establishment, where old realist political views are mutually confirmed and reinforced - no matter whether it is about security policy reservations or pretexts for the very same kind of perspectives. The interesting thing is not what is actually said, but what is not said.

Fundamentally, Sweden is faced by a catch 22 concerning the gas pipeline. Should one seek to undermine Russia's political stability by torpedoing the NordStream project, with increased Russian security policy unpredictability as a consequence, or should one indirectly contribute to support the continuation of a corrupt and authoritarian regime, of which one at least knows what to expect? That is a question that gets little or no attention.

Q: As you see it, is there something we in Sweden have misconstrued in the security policy and geopolitical judgement of NordStream?

A: We, basically, pose the wrong questions about NordStream, and consequently get all the wrong answers. As long as the Swedish political and security policy establishment is dedicated to self-binding about the question of our relations to Russia - regardless of whether it concerns NordStream or general approaches - we risk ending up with the wrong conclusions. As 20 years have passed since the fall of the Berlin wall, it is possible that we as little now as then might predict fundamental changes in Russia. Still, the invasion threat from the East returns in various forms. From military threat to criminality, from criminality to refugee invasion, from refugee invastion to epidemics, from epidemics to energy. The list is long, but what has become reality?

Translation published by permission of Andreas Henriksson, makthavare.se

The Economist Debate on Russia vs. the West

"The West must be bolder in its response to a newly assertive Russia." This is the proposition made for the upcoming The Economist debate series, setting off on 9 September. The opposite argument holds that this position erroneous by Western misperceptions of Russia, based on renewed reminiscences of an increasingly distant Cold War era.

Speaking for the pro side is Anne-Marie Slaughter, Dean of the Princeton University Woodrow Wilson School of Public and International Affairs. Representing the con argument is Dmitri V. Trenin, Senior Associate at the Carnegie Endowment Moscow Centre.

Thus, Slaughter initiates the debate by the following argument:

The West should be bolder in confronting a newly assertive Russia, but bolder in a way that understands and manipulates the realities of 21st-century politics rather than plunging us back into a 20th-century stalemate.

In his rebuttal, Trenin starts out opposing this statement accordingly:

Those who argue that the West should be bolder in its response to a newly assertive Russia are trying to use their memories of the past to deal with a very different present and a highly uncertain future.

The debate will span over the period 9-19 September with rebuttals on the 12th and closing arguments on the 17th. The winner will be announced on the 19th, and topics covered be open for discussion and comments until 26 September.

Registered users will be able to vote surrepetisiously for either alternative during the ten day debate. Following the Oxonian tradition, "members of the House will be thus allowed to "cross the floor" by such vote if arguments are convinving enough to turn their opinion. Questions to the contrahents may be sent in via the Chairman, viz. moderator, who will act as arbiter in selecting those of relevance for further dissection in debate.

The Economist presents the following background for the debate:

Russia’s incursion into neighboring Georgia has Western governments worried about renewed Russian assertiveness. The diplomatic frost between America and Russia remains at a level not seen since the cold war, leading to predictable results: Russian/NATO joint military exercises cancelled, private energy co-operation agreements withdrawn, foreign ministers returned home. Is Russia’s intention to upset the current international order, or is it responding directly to the widening sphere of American influence in former Soviet countries (for example, the promise of eventual NATO membership for Ukraine and Georgia)? Can the European Union speak with one voice and take the diplomatic lead? Or must America protect the world order by standing up to Russia to prove that any form of aggression comes at a cost? Finally, are we witnessing the dawn of a second cold war, in which the West should resist the lure of appeasement?

So, are we in for a heated debate, as East and West seem juxtaposed in a renewed wrestle for right and wrong, power and glory, or simply for the petty interests of their own pockets in a fight for survival spanning ever greater tracts of the world?

That is certainly one purpose of debate, in attracting interest to a sensitive and precarious situation in world affairs. Still, choosing a softy like dear Dmitri to stand for the Russian side and not a heavy-hitter better representative of currrent moods in Moscow may not be the best approach in the pursuit of any profounder realities. Still, it warrants for an interesting and nuanced debate of a character not widely found in these days. I for one will certainly follow the debate with great interest and also invite others to join in the conversation.

Russia: Motives & Misperceptions

As relations between Russia and the West deteriorate, a growing tendency to misperceive Russian motives is discerned. Russia is not a monolithic power, but analysts increasingly tend to give prominence to factors that themselves cannot wholly explain Moscow's actions. A recent example is the Russian-Estonian crisis.

The current crisis between Moscow and Tallinn has its specific origins, and should come as no surprise to most observers. The basic preconditions for crisis were set already in the early 1990s, and both parties are since stuck in a mutually detrimental relationship. The difference this time though is that there currently are no countervailing forces in Moscow to keep the conflict in check, as has previously been the case. This is matched by poor judgement on the Estonian side. Also, the conclusion by western analysts that Russia is using its energy weapon against Estonia by imposing an export blockade seems flawed and an example of mental bandwagoning among people prone to single factor explanations.

Public opinion in Russia about the Baltic states was forged from the disappointment of their determination to abandon the ailing Soviet empire. The Balts were considered part of the liberal and reform oriented forces in soviet society, why Russians felt betrayed by the Balts as Moscow perceivably strived towards the same political goals as the Balts were identified with. The realisation that the Baltics now were abroad took a long time for most Russians to come to terms with. That Russians had become subjects of a non-Slavic state in which they had to seek citizenship to enjoy the full rights of society was incomprehensible. That states like Kazakhstan might treat Russians badly was only to be expected, as they did not share the liberal heritage Russians associated with the Balts. A measure of double standards was thus introduced in comparing the situation of Russians in former soviet republics. As for the Baltics, Russians felt scorned in their identity as imperial civilisation carriers. An inferiority complex was thus the nucleus of the dispute over the situation of Russian "minorities" in the Baltic states.

As things have evolved in Russian-Estonian relations over the last month, the image conjured up by Russian media is that of Russians being wronged and bereft of their rights and heritage. The difference this time is that there are no countervailing forces in Moscow to keep too overt nationalist sentiments in check. Still, most analysts limit themselves to describe the conflict in either bilateral or Estonian terms, whereas Russian domestic factors are left out. This limits reporting to developments of the same Russian-Estonian themes covered over the last 15 years, and old articles might be taken out of the drawer to be rewritten or updated, simply filling in the new facts. In essence, however, they lack the proper contextualisation to explain why the conflict has taken a new turn for the worse. Action is not enough - as the removal of the Bronze Soldier and its consequences. Context must be added to analysis in order for us to understand the full extent of the problem.

Next year, Russia faces presidential elections. By all appearances it seems to be a runoff between Sergei Ivanov and Dmitri Medvedev. The power struggle in the Kremlin is however already underway, and who eventually will get the upper hand sways back and forth between the two main contenders. Half a year ago, Medvedev was in the lead, but now Ivanov has made a comeback and seems to be in the best position to become master of the Kremlin in 2008. In this context, Ivanov has used the Estonian crisis to gather his forces in front of a common foe. Opinions on Estonia are by now so deeply set that they may be used as a vehicle to gather the Russian masses. Previously, Russian leaders have known where to draw the line in using the "Baltic question" but now president Putin cannot put the foot down as too great interests are at stake, in who will rule Russian politics in coming years, to risk anything just to preserve a working relationship with Tallinn. As for relations with the European Union and Nato, Putin walks a thin line in risking a multilateralisation of the Estonian issue.

However, Medvedev is also not left out in gaining the dividends of the Estonian crisis. Last week, Sergei Ivanov, during a meeting with governors in Murmansk, declared that the Russian oil and coal previously exported by transit through Estonia will now instead go through the port of St. Petersburg. Russia annually ships around 25 million tonnes of fuel oil, gas oil and petrol through Estonian ports. Imposing a Russian energy blockade on Estonia is regarded by many analysts as a way for Moscow to use its energy weapon. Such a conclusion, however, seems flawed as Estonia is relatively spared of any major consequences for its energy supply. Instead, it may prove a way for major Russian oil exporters - mainly Rosneft - to curve export competition by other Russian oil companies.

Transferring exports to St. Petersburg will indirectly give Rosneft greater control over who will be able to export Russian oil. St. Petersburg port is already today gravely undersized - not to mention corrupt - and much effort has been made in recent years to construct new harbours in the Gulf of Finland - Primorsk for oil and Ust Luga for bulk. Opting for Petersburg therefore means that companies that previously have exported by way of Estonia now are at the mercy of Rosneft to meet their deliveries to western customers. In essence, the energy blockade against Estonia gives Medvedev's interests a way to hit at remaining independent competitors within the oil industry. Consequently, Ivanov reaps the political and Medvedev the economic rewards of the Estonian crisis.

So, should all explanations based on the actual situation in Estonia and relations with Russia be discarded? Of course not. However, it is equally important to analyse the conflict on its own merits as it is to contextualise it, striking a balance on the domestic-foreign frontier. An obvious example is the risk that the conflict may spread also to Latvia. Most observers would say that situations differ too much for something similar to happen in Riga, but still Latvian authorities are apprehensive. From both a political and economic perspective, Ivanov and Medvedev may gain from sparking a crisis also with Latvia for the very same reasons why they have let the crisis with Estonia get so much out of hand. There simply is too much to gain and too little to lose domestically at the moment, that a Russian-Latvian crisis should not be ruled out just because situations in Estonia and Latvia are not similar enough. Giving the crisis a Russian domestic political contextualisation shows this.

Still, is the Kremlin willing to risk its relations with the West - EU, Nato and the US - over such an insignificant issue as the Baltic question? Actually, such an assumption should not be ruled out. Already, Moscow is at loggerheads with Washington, and the US understands that it now has to be tough on Russia in order to have a working relationship. The European Union, however, takes a much weaker stand when it comes to Russia, and when it does confront Moscow it is on negotiation issues such as the Partnership and Cooperation Agreement (PCA) and the European Energy Charter. Until now, Russia has never had anything to lose in real terms in relations with the EU, and the Union consistently avoids putting its foot down in relations with Moscow. That Poland and other member states, in this context, may hamper EU-Russia negotiations is officially treated with resignation in Bruxelles, while most unofficially sigh with relief. Thus, Russia rationally calculates that the EU will never truly make a stand in their relations, why Moscow really risks nothing by a confrontational policy.

Developments in Russia are met with growing concern in Europe, and there is an understanding that sooner or later the European Union will have to confront the issue, as many of its members are already experiencing the realities of a more assertive Russia on the world stage. Doing so, however, sets out from, on the one hand, foreign relations and, on the other hand, Russia's domestic political situation. The latter is mainly directed at the crisis for democracy and human rights and far too seldom at the factors that Russian rulers themselves would deem of political importance. Foreign and domestic factors are increasingly treated as monolithic and attempts at joint analysis are often superficial or aim at the wrong factors.

The result is that it is becoming all the more of a mystery in the West why Russia acts as it does. The West is once again allowing Russia to become "a riddle wrapped in a mystery inside an enigma" for the evident reason that Europeans are too subsumed by their own values, norms, perceptions, and prejudice to follow the simple logics of current Russian politics and society. Then it is much easier to produce an image of a state that once more might pose a threat to Europe - an alien entity accepted by its mere existence but doomed to remain foreign to Europe. Here, the Russian-Estonian crisis serves as a striking example of how the West fails to account for important factors in its perceptions of Russia. As European public opinion turns increasingly against Russia, the risk of misperceptions may become an even greater danger than a revived Russian threat in the eyes of Europe. Russian motives are not always what they seem.

Estonia: Battle by Bronze Proxy

Why is it that a WW II-monument repeatedly sparks bilateral crises between Estonia and Russia? This question has, in recent days, gained new relevance after strong Russian reactions against the Estonian parliament's decision to remove the so called Bronze Soldier (Pronkssõdur) soviet war monument from central Tallinn. The reason is simple: The Bronze Soldier has become a proxy for the conflict between Estonian and Russian interests in Estonia before the 4 March parliamentary elections. The Estonians thus vage a battle by bronze proxy.

It is becoming increasingly clear that Edgar Savisaar's Centre Party (Keskerakond), will stand as victors on election day, ousting the coalition government led by Prime Minister Andrus Ansip's Reform Party (Reformierakond). Such a result risks toppling the delicate balance between western financial interests, dominating the Estonian banking system, and Russian interests controlling the lucrative transit trade, with far-reaching consequences for domestic and foreign policy.

Economic interest has been one of the main driving-forces in Estonian politics since the country regained its independence in 1991. A division of labour was developed roughly between two opposing groupings - the Russians controlling transit trade and backed by Moscow, and the Estonians controlling the financial and banking sector and backed by western - mainly Scandinavian - interests. This is reflected also in politics. Thus, Savisaars Centre Party has gradually become Moscow's agent, with heavy economic backing from Russia, to the point that the party actually has entered into union with Russian power party United Russia (Единая Россия). Savisaar's main opponent, the Reform Party, is to the contrary linked to finance and banking dominated by western business interests. A final peculiar twist to the matter is that these two main contenders for political power in Estonia, in fact form the current coalition government, together with the People's Union (Rahvaliit).

It is obvious that the the Bronze Soldier crisis this time is a desperate attempt by the Reform Party, facing potential defeat, to gain votes by shedding light over the close relations between the Centre Party and Russia. So, who are the major players in Moscow's relations with Estonia? On the Russian side, two names stand out as safeguarding these interests, namely Gleb Pavlovsky, one of Russia's foremost "political technologists," and Igor Levitin, Russia's Minister of Transportation. Pavlovsky gained wider international attention in 2005, due to allegations of involvement in the dioxin poisoning of Ukrainian president-to-be Victor Yushchenko. As for Levitin, Savisaar the other year unsuccesfully tried to grant him Estonian citizenship due to his great services to the country.

Then, what is actually at stake for the upcoming elections? Estonia is currently struggling with an overinflated rate of public lending - a financial bubble that could easily burst in face of any radical change of power in Tallinn. If Savisaar's Centre Party would win on 4 March, this might well be the spark to set off a major financial crisis in Estonian economy. As the Reform Party relies on the finance and banking sectors that constitute the lenders, such development would be catastrophic to the party, and potentially topple the fragile balance of power within Estonian politics and society. Moreover, it would hit hard on the western investors, forming Estonia's link to European economy. Therefore, the Reformists now are desperate to undermine the Russian interests forming the power base for Savisaar's Centrists. Thus, the Bronze Soldier crisis must be seen as an attempt to provoke sanctions from Russia, which would hit the very transit trade that forms the basis of Savisaar's Russian backing.

As the Estonian parliament (Riigikogu) this morning decided to move the Bronze Soldier monument, the country's president, Toomas Hendrik Ilves, was quick to declare that he would not sign such legislation, claiming it to be in breach of the constitution. In this context, one must ask whether it really was necessary for the parliament to pass a law on the removal of the Bronze Soldier. If this really was the intention of the Reform Party, could it not have been easier accomplished by a simple government decision? From this perspective, it is quite obvious that the Reformist ulterior motive was to provoke a crisis with Russia that would benefit the party for the upcoming elections.

So, what have been the reactions in Moscow? Russian Foreign Minister, Sergey Lavrov, was quick to characterise the decision as a "grave mistake" and as a "blasphemous act." Also, the chairman of the Russian Duma's foreign relations committee said that the decision would have catastrophic consequences for Russian-Estonian relations, especially trade and economy, thus hinting at exactly the effect the Reformist Party wanted to achieve. However, Estonia's ambassador to Moscow, Marina Kaljurand, was quick to point out that Russia would be unlikely to impose bilateral sanctions on Estonia, not wanting to risk a "trade war" with the European Union. What will actually come out of this is yet to be seen, but it seems that Russian politicians would be shrewd enough to call the bluff. Still, Russian-Estonian relations have been shaky for long, as previously reported, so it is difficult to say what will come out of Moscow this time.

Here one should instead direct more attention to an overseen foreign policy factor in the context of Russian-Estonian relations, namely the projected Russian gas pipeline through the Baltic Sea. This crucial project for Russia is meeting increasing opposition among Baltic Sea states, and currently public opinion also in Sweden is turning against letting the pipeline run through its territorial waters. Would Sweden and other Baltic states turn down the project, with a Centrist government ruling Estonia, one scenario is that Russia might turn its frustration towards Tallinn, possibly giving massive support to Savisaar in order to gain a permanent influence over EU-member Estonia. This would create a very difficult terrain for the EU and Estonia's neighbours to manouevre, not to speak of what challenges it would pose to president Ilves and the Estonian political system.

Finally, is there any solution in sight for the issue of the Bronze Soldier monument? As for its removal, Estonia probably lost its chance back in 1991. However, doing so spurred an idea of expanding the monument to hold also statues of Estonian, German, as well as allied soldiers of WW II, along with various paraphernalia. This idea was never realised, paradoxically due to lack of metal for the statues. In the early 1990s, Estonia was a major exporter of metal, despite its evident lack of this type of natural resources. Mainly Russian business interests made fortunes by exporting whatever metal scrap they could lay their hands on, thus forming the mighty Russian economic interests that now dominate the transit trade. So, what then made Russian fortunes - the metal that might have expanded the Bronze Soldier monument into a unifying symbol for Russians and Estonians alike - now comes back to haunt the transit profiteers by a constant threat of sanctions to their trade. Had there been metal then, this explosive matter might have been defused at an early stage. Then, of course, Estonians and Russians would probably have found some other symbol to quarrel over.

Comment: On Baltic economy, especially Latvia, cf. "A Bursting Baltic Bubble." For an overview of Russian-Estonian relations see also "Estonia: Stalemate in Russian Relations."

Armenia Railroaded on Train Line

Last Thursday, an agreement was signed between Turkey, Georgia and Azerbaijan on the contruction of the Kars-Tbilisi-Baku railroad, further barring Armenia from infrastructural cooperation in the western Caucasus. Effectively, Armenia is increasingly isolated from regional developments of great consequence for the country's future. As a consequence, Armenia may be further driven into the arms of Russia, strengthening the delineation of spheres of interest in the Caucasus between Russia and the West.

The agreement, signed in Baku, by Turkish Prime Minister Erdoğan, Azerbaijani president Aliyev and Georgian President Saakashvili, bypasses Armenia by opting for the Kars-Akhalkalaki-Tblisi-Baku stretch, instead of the previously designated, and already existent, Kars-Gyumri rail line, going through Armenia. The Armenian-Turkish border, and along with it the Kars-Gyumri railway, has been closed since 1993, due to the 1988-1994 Armenian-Azerbaijani war over Nagorno-Karabağ. Thus, the Kars-Gyumri alternative would have meant reopening the border - a matter too difficult for Turkey to deal with in view of the sensitive Armenian question and upcoming parliamentary elections. As the opposite now is the case, Thursday's Baku agreement, by excluding Armenia, only serves to prolong a stifling status quo in relations between Yerevan and Ankara, and furthermore risks regionally isolating Armenia to the benefit of Russia.

The idea of the railway project, popularly known as the Iron Silk Road, originates from the 1960s, when the first plans to form, what is now known as, the Trans-Asia Railway Network (TAR) were raised. From the original plan of uniting 14.000 kms railroad from Singapore to Turkey, the scheme has grown to fathom some 81.000 kms, spanning all over the Eurasian continent. Thus, in November last year an agreement was signed to this end, under the aegis of the UN Economic and Social Commission for Asia and the Pacific (UNESCAP), as reported by RFE/RL-Online.

On the regional level, the question has been how to unite the various railway systems, linking the countries in the Caucasus with Turkey, as part of the larger Iron Silk Road project. Thus, a corresponding agreement was reached, by the Parliamentary Assembly of the Black Sea Economic Cooperation (PABSEC), as early as in 2005. It stipulated that the Kars-Gyumri-Tbilisi-Baku railway should be considered the only viable option for uniting the regional railway network, while it would connect all countries in the region, not need any substantial investments, and avoid any potential dividing lines. However, keeping to these and similar committments has proven very difficult.

On a strategic level, the Kars-Tbilisi-Baku agreement further underlines how the delineation of spheres of interest in the Caucasus between Russia and the West is exacerbated. Leaving Armenia out of the dynamics of regional development in this way, poses the question of how far-reaching a tacit understanding there is, that "Armenia belongs to Moscow." Another factor for leaving Yerevan at the side of the road, might be that western interests want to avoid being exposed to the risks of relying on infrastructure that, in event of crisis, may be controlled by Russia. A 5,000 man strong Russian troop contingent is currently posted on Armenian territory.

The agreement also shows how both Russia and the West attach an increasing importance to control over strategic infrastructure. It is no secret that the West's most important regional infrastructure project in Eurasia, namely the Baku-Tbilisi-Ceyhan pipeline (BTC), runs through Azerbaijan, Georgia, and Turkey, partly due to the ambition of strategic control. That Moscow has been negative to reopening the Kars-Gyumri railway, between Armenia and Turkey, serves as no surprise in this context.

As for Armenia's international position, Yerevan would like to regard itself as a "Finland of the Caucasus" in terms of dealing with Moscow. During the Cold War, the Finns succesfully defended their national sovereignty by a well-balanced policy towards Moscow, safeguarding their country against recurrent Soviet plans to bring Finland in under the umbrella of the Warzaw pact. The fears in the West of so called "finlandisation" thus in the end turned out to be exaggerated, although Helsinki at times was weighed down under the pressure of Moscow's interests.

While Finland could benefit from the Cold War balance-of-power system in Europe, as a counterweight to the Soviet Union, Armenia since the 1990s has had greater difficulty to gain a corresponding means of balance. A double-edged instrument has been to use the Armenian diaspora in the West, which could equally complicate as facilitate regional relations. In the context of the Kars-Gyumri railway, Armenia has used its Westen lobby-groups to bar the Kars-Tbilisi-Baku stretch favoured by Turkey. Thus, US Armenian groups last year succeeded in blocking American funding of the Kars-Tbilisi-Baku railway by securing a decision of the US Congress. By Thursday's Baku agreement, such measures now seem to no avail, as construction of the new railway stretch - bypassing Armenia - now are to be realised. However, the final word has perhaps not been said yet, judging from how positions on the issue have slided back and forth in recent years.

On a national level, the Baku decision comes at a most inconvenient time, as Armenia is up for parliamentary elections on 12 May this year. Overshadowed by the Orange and Rose revolutions in Ukraine and Georgia, Armenia is undergoing somewhat of a political refolution, as Ralf Dahrendorf so succinctly termed events in Central and Eastern Europe by the end of the Cold War. It remains to be seen whether Armenia will be able to carry through its process of change under the weight of various domestic and international pressures.

Regretfully, Thursday's railway agreement puts Yerevan at the crossroads between Russian influence and continued regional integration. It is thus fair to say that Armenia has been railroaded in making its independent and sovereign choice on its future forms of regional and international cooperation.

Ukrainian Lighthouses & Landmarks

Little more than a month after becoming Ukrainian Prime Minister, Viktor Yanukovich, seems poised to break his pledge to president Viktor Yushchenko of Ukraine's continued western integration. Visiting Brussels on Thursday, Yanukovich put a moratorium on Ukraine's plans to join Nato, saying that: "Because of the political situation in Ukraine, we will now have to take a pause," according to International Herald Tribune.

However, what should be clear by now is that NATO and EU accession has become a parallel process in the integration of former Eastern bloc countries. Therefore, Yanukovich "pause" effectively means a halt - or at least a severe delay - for Ukraine's western integration.

That NATO and the EU are different organisations and deal with different issues should not disguise the fact that a majority of EU-members are also members of NATO. Combined with the backlash of the Orange revolution, Yanukovich statement is likely to further put off western leaders from any real association with Ukraine. Trust in Ukraine is at a low and the only real motivation for western efforts is to keep the country out of Moscow's orbit.

Still, Yanukovich's decision on NATO is logical. Popular support for NATO-membership has never reached any substantial levels, so his excuse to "play it safe" rather than to rush into something that Ukrainians will not accept is natural. This has tacitly been accepted by NATO-officials as a statement of facts rather than intent. At the same time, questions are raised what role Russia might have had in the decision. Yanukovich has previously declared that he would like Ukraine to be a "reliable bridge" between Europe and Russia, and NATO-membership seems incompatible with such a role. Russia has adamanttly opposed Ukrainian rapprochement to the Atlantic alliance.

Relations with Russia continue to be strained. Only yesterday, a Ukrainian court ordered that authorities should take control over 22 lighthouses in the Crimea that have been leased to Russia's Black Sea Fleet, BBC reports. As late as in June, Russia and Ukraine failed to reach agreement on settling the Kerch strait border dispute, which has been going on since 2003, according to RIA Novosti.

Ukraine's relations with Russia on the one hand and the West on the other have often been simplistically depicted as balancing between East and West. A similar balance accordingly applies to Ukraine's domestic scene - between Russian and Ukrainian speakers. As anyone who has dealt with Ukraine knows, realities are much more complex.

Still, the image of a Ukraine split between East and West lingers on in the minds of international leaders and is also exploited by a variety of actors. At a time when there are great doubts in the West as for Ukraine's willingness and ability to integrate, there is little room for a more straightforward public policy.

Yanukovich might have pursued a declaratory policy on NATO and EU membership at the same time as deepening relations with Russia. As long as no real steps towards NATO-integration were to be taken, such a situation might have been acceptable both to Russia and the West. That would have kept doors open for Kiev - both towards Brussels and Moscow.

Now, Yanukovich is closing the NATO-door and thereby - in a longer perspective - also the EU-door. This might however not open the door to Russia any wider, simply because the Kremlin has never accepted its loss of influence over Ukraine. A loss that one has not accepted is not regarded a real victory once it is regained.

Public postponement of NATO-integration is thus simply not a good idea at a time like this, when Ukraine needs the best of both worlds. The paradox is that what would probably serve Kiev's interests best at this point would be to say one thing and do the other, that is pledge western integration and cooperate more closely with Russia. In that way, Ukraine might have maintained safeguarded by the West at the same time as it could have remained part of the East. Now instead, Yanukovich has set a landmark in Ukraine's modern political history by giving away an important foreign policy instrument for no obvious reason. Cui bono? What does Ukraine or Yanukovich stand to gain from self-imposed alienation when one needs all the help one can get?

Ukraine: New Government in the Making

On Wednesday, news broke that a new orange coalition government is forming in Ukraine. Both president Yushchenko's Our Ukraine and the Timoshenko bloc (BYuT) confirmed that an agreement had been reached. The news comes amid rumours that Yushchenko was teaming up with orange revolution enemy Yanukovich and his Party of Regions.

If the deal goes through, Yulia Timoshenko will once more become Prime Minister, which has been her primary goal since she was sacked from the post last September. The coalition will be between Our Ukraine, BYuT, and the Socialist Party, which has been the main negotiating approach all along.

Indeed, negotiations to form a coalition between Our Ukraine, BYuT, and the Socialist Party, have been underway ever since the 26 March parliamentary elections. At the beginning of April, Our Ukraine announced that unity had been reached. Then, nothing happened. In mid-May, it was Timoshenko's turn to declare that a new government had been agreed on. Once again, nothing happened. So, one might well perceive news from Kiev on a new cabinet with sound skepticism, were it not for a constitutional deadline on forming a government. Therefore, it now appears that Ukraine will eventually get out of its post-election political deadlock. However, as BBC's Kiev correspondent states, "The deal will not be certain until it is signed."

If the deal goes through, BYuT is said to receive a dominant 11 cabinet posts, including the Premiership. Our Ukraine will get the post as speaker of the Parliament, and has already nominated Petro Poroshenko. The Socialist Party will appoint the vice-Premier.

By all appearances, Ukraine will be in for a tough political ride with its new cabinet. Neither president Yushchenko nor Poroshenko stand Timoshenko, since the fall-out and scandals leading to Timoshenko's dismissal as Premier last September.

Moreover, constitutional changes this year weaken the presidential powers to the benefit of parliament - the Verkhovna Rada. The Rada has a long tradition of relative independence, playing its role in the political balance of power, and party allegiance is far from granted. With fiery and controversial Yulia Timoshenko as Premier, parliament may decide to get in the way of her plans at leisure.

However, there is one strong binding-force uniting the new government. The political forces of the Orange Revolution has failed once. This time they have to succeed or face total political discredit for the foreseeable future. Thus, as Ukrainian political analyst, Volodymyr Fesenko, put it to AFP: "It's a second chance and if they fail, they'll all go down together."

Turning to Ukraine's international relations, with Timoshenko as Prime Minister, relations with Russia are in obvious jeopardy. Already the same day that the new coalition was announced, Timoshenko called for a review of the Russian-Ukrainian gas deal that ended the New Year's gas crisis earlier this year, BBC reports.

In addition to this, the US Marine Corps participated in exercises on the Crimean peninsula a few weeks ago, which sparked fears in Moscow of Ukrainian ambitions to join Nato. Thus, Russian foreign minister Sergei Lavrov warned Ukraine that such a move would seriously hurt relations Moscow and Kiev.

The majority of Crimeans are ehtnic Russians, and the Black Sea peninsula was transferred from Russia to Ukraine as late as in 1954 by Soviet leader Nikita Khrushchev. Therefore, the presence of US troops in a disputed Ukrainian region does not serve to improve Ukrainian relations with Russia. Indeed, the government that is now being formed will inevitably have to meet major challenges in its relations with the Kremlin.

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.

Russia as a Great Power: Dimensions of Security under Putin

Everyone who has done it, knows how much works it takes to write or edit a book. As the editor with main day-to-day responsibility of Russia as a Great Power: Dimensions of Security under Putin (London: Routledge, 2005), I was happy and relieved to finalise a year's work on the volume, and getting it accepted for publication by Routledge. Little did I know that it would take another year for it to appear on the market. Being an anthology, with contributions by 14 different writers from 7 European countries, I was and still am very pleased that we succeeded in staying in line with the general theme of the book, viz. that of Russia as a Great Power foreign and security policy actor. Whether this is really the case is, however, up to the reader to judge.

The book covers four dimensions of Russian policy: external security, regional security, internal security, and terrorism.

After a period of relative weakness and instability during most of the 1990s, Russia is again appearing as a major security player in world politics. This book provides a comprehensive assessment of Russia's current security situation, addressing such questions as:

• What kind of player is Russia in the field of security?
• What is the essence of its security policy?
• What are the sources, capabilities and priorities of its security policy?

One important conclusion to emerge is that, while Russian foreign policy under Putin has become more pragmatic and responsive to both problems and opportunies, the growing lack of checks and balances in domestic politics makes political integration with the West difficult and gives the president great freedom in applying Russia's growing power abroad.

Monkeys & Tigers of Putin's Foreign Policy

What are the major characteristics of Russia's Putinist foreign policy? What is obvious is that the growth in oil incomes is parallel only to the growth in self-confidence and self-reliance in foreign affairs. Thereby, the "multivector policy" has finally got off the ground. Current Russian foreign policy strategy may, however, turn back with a vengeance on Russia. Solitude is not a succesful recipe for international affairs.

Threats to Russia
The long-term security policy threats to Russia are terrorism, militant Islamism, the spread of weapons of mass destruction, a stronger China, and instability due to the spread of "open society". These are serious problems that demand serious answers. Instead, Russian foreign policy is characterised by increased self-confidence and a walk it alone mentality.

Multivector policy

Since 2003, the drive for co-operation and partnership with the West has been abandoned. Current "multivector policy" avoids stable relations and partnership with other powers. Moscow exploits Western weakness - the EU crisis and US endless engagement in Iraq. Russia tries to be a "monkey on top of a hill, overlooking the tigers fighting on the plain".

The near abroad - a chain of instability

Dominance over the "near abroad" is still the overarching goal of Russian foreign policy. Moscow's increased self-confidence obscures the setbacks in Georgia and the Ukraine. The danger of current policy is that the risk for new crises and revolutions in the Russian sphere of interest is underestimated. The contradiction between personified power and weak systems in post-soviet states constitutes a latent risk of instability in Russia's backyard for the coming 10-15 years. Here, elections counterposes self-perpetuation of personified power and political legitimacy. It is the soft authoritarian hybrid regimes - as previously Ukraine and perhaps Armenia next - that are the weakest links in the chain of instability, which runs through Russia's proximity.

Central Asia - the Great Game revisited?
In Central Asia, there is danger of escalating tension between Moscow and Washington. Russia and China jointly try to act as regional stabilisers, at the same time as increased Chinese influence contributes to growing conflict potential between the two countries. Post-soviet space constitutes an unstable, volatile and fluidous region in the vicinity of the EU.

Making it alone - a recipe for disaster

As Russia is all the more turning into a unilateral and uncooperative actor, one must realise that Putinist foreign policy will face great challenges. Perceived threats to Russia are based on traditional views, which may not be entirely in tune with times. If Moscow continues to pursue the multivector policy, such threats may, however, become a self-fulfilling prophecy. To abandon cooperation with the West is tantamount to losing a potential partner in solving the problems facing Russia in post-soviet space. Moscow's support for weak regimes - undemocratic and illegitimate - will only serve to amplify instability in the "near abroad". As an effect, revolution may turn on Russia as well. Finally, Russia is treading a delicate balance-act in Central Asia, where a new "Great Game" may evolve, if not being careful. In all, Russia is applying a traditional policy on untraditional problems, which cannot possibly succeed in the long run. Therefore, it is likely that the image of monkeys and tigers will prove an act of self-deception. Instead, Russian foreign policy may prove a recipe for disaster if the monkeys were to: "Hear no evil, see no evil, speak no evil". This is, however, the path Russia currently is heading with its multivector policy.