Examination of Witnesses (Questions 240
- 259)
MONDAY 19 NOVEMBER 2007
Sir Anthony Brenton
Q240 Lord Swinfen:
Do the Russians have the equivalent of the British Council here
or elsewhere in Europe?
Sir Anthony Brenton: They have one man in their
embassy here doing cultural work and they are thinking about expanding
that operation. I am afraid I do not know what they have elsewhere
in Europe.
Chairman: I think we should perhaps move on
to the main area, which is of course relations with the European
Union.
Q241 Lord Crickhowell:
We are a European Sub-Committee so I would like to ask you now
how you think Russia sees Europe, how it regards doing business
with Europe as Europe, and how that has changed perhaps as things
have developed.
Sir Anthony Brenton: First of all, Russia thinks
of itself as being part of Europe—not of the European Union
but it thinks of itself essentially as a European country, sharing
European values and part of European civilisation. That characterises
quite a lot of their relationship both with the EU and with individual
Member States. With regard to its relationship with the EU as
an entity, they essentially view it as an economic entity. They
have very little dealing with it on the political side. You have
recorded in the list of questions you sent me the various documents
which have been produced in the course of trying to develop that
relationship, the latest of which is the Partnership and Co-operation
Agreement, the renegotiation of which is hanging fire at the moment
until the Polish problem is sorted out. What more can I say? I
think they still take dealing with national governments quite
significantly more seriously than they take dealing with the European
Union as a whole and I think they were quite shocked, for example,
by the draft Energy Directive which the Commission produced a
few weeks ago, because that, if it were adopted in anything like
the form in which it has come out of the Commission, would have
very significant implications for Russian interests. It is that
sort of event which brings home to them the potential significance
of the EU qua EU for them. Most concrete, day-to-day business
tends to be done with the Member States.
Q242 Lord Crickhowell:
Some have said that they started off by wanting to deal with the
EU in the sense of wanting to deal with a single person, a single
office, someone they can go confidently to, and they were rather
shocked to discover that they could not do that but saw a great
opportunity to exploit the differences and play off the European
countries one against the other.
Sir Anthony Brenton: I would not have put the
sequence quite like that. In areas—and there are a lot of
them—where Russian interests differ from the EU, then, like
every other country actually, they will look for friends within
the EU who will help to represent them and look after their interests.
Particularly on the energy front, that has been very much their
tactic.
Q243 Lord Crickhowell:
You refer to the energy front. Interestingly, you previously referred
to the climate change front and said that Russia has a major role
to play. Although we are about to debate the Climate Change Bill
in this House next week and Britain likes to say that we are taking
the lead on these matters, in a real sense, in the whole of the
environmental world, Europe is going to be more important on climate
change, and European policy is probably more important than British
policy on its own. Therefore I would be very interested if you
could elaborate a little on that remark you made earlier, that
Russia has a major role to play. How do you see them playing that
role, particularly in relation to Europe?
Sir Anthony Brenton: Russia is, I think I am
right in saying, the third largest national emitter of carbon
dioxide in the world, a major source of hydrocarbon exports and
hydrocarbon suppliers and they own a seventh of the world's surface,
including a lot of tundra and other potential areas which are
potentially important from a climate change point of view. So
obviously, if the world is to have successful negotiations, as
we all hope, in getting climate change under control, then getting
Russia on board will be a very important part of those negotiations.
I have to say we have not actually been very good at that so far,
either the UK or the EU as a whole. The Russians are difficult
on this subject. Their scientists are not entirely convinced.
There is a stream of opinion in Russian business circles that
while they are doing so well out of oil and gas a global regime
which limits demand for oil and gas is probably not going to be
a very good thing for Russia, and Russia is a large, cold country
where there is another stream of opinion that actually, a rather
warmer world would be a good place from Russia's point of view.
So there are all sorts of complications there. It seems to me,
in a sense, precisely because there are all those complications
there, precisely because we do not see eye to eye on this, there
is a very strong argument for the EU and for the UK to engage
seriously with Russia on this subject.
Q244 Lord Swinfen:
What do you think should be the fundamental objectives of EU policy
with regard to Russia and what does the EU have to offer Russia
in the context of the negotiations? How can it best influence
Russian thinking?
Sir Anthony Brenton: I think the fundamental
objectives of the EU with regard to Russia need to be twofold.
Firstly, to continue to expand the fast-expanding in any case
economic links, human links, social links, investment links, trade
links. Finally, if Russia is to become a normal European country—and
I am confident it will—that is going to happen through a
sort of osmosis, through a sort of feeling that they are inside,
through a sort of feeling that they are a member of the club.
That is the first thing. The second thing that I think it is very
important the EU continues to do is to plug away on the democracy/human
rights front. Obviously, there are imperfections there in Russia.
Obviously, they do not yet entirely meet European standards. There
are good ways and bad ways of making that point to the Russians
but to continue to make our interest and concern clear is a way
of bolstering the best elements in Russian society, is a way of
encouraging the sorts of developments that we want to see and,
as I said earlier, the Russians see themselves as part of Europe,
see themselves as carriers of European standards and, if there
is an area where they see themselves as being badly out of line
with contemporary European performance—and human rights
is arguably one of them—it is an embarrassment and an encouragement
to them for that fact to be drawn to their attention.
Q245 Lord Chidgey:
Is there not a contradiction here in the philosophical approach
of Russia to Europe? On the one hand, we all understand that Russia
sees itself as more European than anything else, yet the more
European Russia becomes, the less and less it can claim to be
a great power because the whole concept of being closer to the
EU is being part of the family rather than being one above the
family. That may sound fairly trite in our conversation but, as
I understand the way the Russians look at things, this could be
a very important factor.
Sir Anthony Brenton: Again, two points. Firstly,
Russia's awareness of itself as a great power is obviously a major
impediment to them taking on the constraints of sovereignty which
would be involved in actually joining the EU but I do not see
it as any obstacle to them getting closer to the EU. If I could
add a personal point, I believe I work for the government of something
like a great power which nevertheless manages also to be a member
of the EU.
Q246 Lord Anderson of Swansea:
There are areas of policy outwith national governance and within
the competence of the European Union, notably trade policy. To
what extent is Russia prepared to modify its own legal systems
to provide, for example, greater protection for minority shareholders
and so on as a result of pressure from the EU, acting on behalf
of national governments as a whole?
Sir Anthony Brenton: I think the answer to that
is that there is some willingness; it is slow and it is difficult
but there is a willingness in the Russian systems to move towards
not just EU but Western standards. The best example of that actually
is Russian moves towards joining the World Trade Organisation,
which have been slow, difficult, subject to reversals. We are
not there yet but there is no doubt in my mind that certainly
the economic establishment in Moscow and a very substantial proportion
of the business community—not all of it—are pushing
Russia more and more to take on the sorts of standards which will
make Russian business circumstances compatible with and comfortable
for Western businesses and business circumstances. There is another
extra motivation in all this, which is that big Russian businesses
now want to become international themselves, they want to invest
in the UK, in America, in other parts of the EU, and they know
that in order to do that, they have to meet international standards
not only overseas but at home as well. So I think it is difficult
but I think there is a willingness to move under pressure and
under persuasion.
Q247 Lord Anderson of Swansea:
That includes resolution of commercial conflicts through arbitration
outside?
Sir Anthony Brenton: Yes, I hope so. One of
the things that we in the UK have been very keen to pursue through
the next iteration of the Partnership and Co-operation Agreement
is precisely proper protection for investors in Russia through
proper arbitration and rule-enforcing procedures. That is in our
mandate and I do not see that as an unrealistic thing to aim for
as we take the negotiation forward.
Q248 Lord Anderson of Swansea:
Do we, as part of our policy either bilaterally or with the EU,
provide any training in those legal norms to provide a greater
coverage of the rule of law commercially?
Sir Anthony Brenton: I am at the moment getting
together some legal firms in Russia, British legal firms, all
of which have large offices now in Moscow, precisely to try and
set up a scheme of financing young Russian lawyers to come to
the UK and get some of our practice. This is not purely from a
business point of view; I want them also to understand how a real
legal system works from other points of view, notably protection
of human rights and so on. That is not a new scheme. That is our
attempt and there are other schemes like it.
Q249 Lord Anderson of Swansea:
Solely on the commercial side, not on the human rights?
Sir Anthony Brenton: No, we anticipate it having
the two effects. It is very good to get these guys through British
law firms and through London because that gives them a disposition
towards using us and using our legal norms on the business side,
but also it helps them to understand how we operate on the criminal
side and the rule of law side, which is an important lesson, I
think, for the Russian system to absorb.
Q250 Chairman:
Just on the question of the WTO negotiations, interestingly, in
the letter we have had about the meeting in Mafra, apparently
Mr Putin said that while he called accession to WTO a natural
process, he said Russia would choose to join only if the conditions
for accession met Russia's national interests, which suggests
perhaps a slowing down of his enthusiasm for the WTO.
Sir Anthony Brenton: I do not think there is
anything new there. I think that has always been Russia's position
and I am sure it has been the position of every other country
that has joined the WTO.
Q251 Chairman:
It suggests that we have not necessarily got very much leverage
as far as the WTO membership is concerned.
Sir Anthony Brenton: We have the leverage which
is given by the lobbies in Moscow, which includes the Finance
Minister, which includes the Economics Minister, which includes
the leading businessmen who want Russia to be inside the tent,
who see the advantages for them, not least in terms of persuading
the Russian system to become more transparent in its internal
workings, of Russia joining the WTO.
Q252 Chairman:
You mentioned earlier the institutional framework for EU-Russian
relations based on the Partnership and Co-operation Agreement,
which is coming to an end, the so-called "four common spaces"
and also the Northern Dimension. How far do you think they are
working well? Do you think there should be changes in the institutional
relationships as we look forward to a new agreement?
Sir Anthony Brenton: I do not think they are
working very well. My impression is that what the EU has accumulated
with Russia—and I do not think this is a unique situation—is
an awful lot of written-down aspirations with rather little real,
material content. I think the important dynamic thing that is
happening in EU-Russian relations is not being done by bureaucrats
and ministers; it is being done by ordinary businessmen and ordinary
people who are more and more travelling, more and more trading,
more and more investing and, as they create the close links, I
think the agreements will follow. One very important agreement,
on the basis of the huge investments we now have, is a decent
agreement to protect our investments in Russia.
Q253 Lord Crickhowell:
We have already in a number of ways begun to touch on the whole
question of European solidarity, or lack of it. We have talked
about the new peripheral members, who have sometimes rather different
attitudes to the old core EU members. You have begun to refer
to energy but even on energy, although we may be developing an
energy policy, there are profound differences between, for example,
German policy and that of some other countries. Would you comment
more about the need for European solidarity and how you think
perhaps Europe should set about the game?
Sir Anthony Brenton: Yes. There has undoubtedly
been a problem with EU solidarity and, in particular, a wide range
of views with regard to political developments in Russia. Some
EU Member States have been inclined to give Russia a much more
tolerant approach with regard to the problems that Russian democracy
is having, with regard to the problems of human rights in Russia,
than others. Charles Grant's outfit have just produced a report
which sets out a typology of different European state attitudes.
Q254 Chairman:
Mark Leonard's outfit, I think.
Sir Anthony Brenton: It is Mark Leonard. That
is right. It is a rather good report, which I commend to the Committee's
attention. The way he typifies various Member State attitudes
to Russia, he gets it pretty close to right, and that disparity
of views has undoubtedly been a huge complication for the EU in
reacting to developments in Russia. That said, I think things
are getting better actually. With the changes of President in
France and of Chancellor in Germany, it has been quite striking
that the EU are much less widely dispersed on human rights developments
in Russia now than they were when I first came into this job three
years ago. It was very striking to me that, when Poland blocked
the progress of the PCA negotiation, what you would have expected
three years ago would have been some key, large Member States
ganging up to lean on the Poles to get out of the way, and that
did not happen. There was much more sympathy to the Poles' concern
in the EU of 27 states that we have now than there would have
been three years ago. I think that convergence is important because,
obviously, the more the EU can speak with one voice, the more
that voice will be heard in Russia.
Q255 Lord Anderson of Swansea:
Is it perhaps naïve to have a 27 musketeers' approach of
one for all and all for one? Certainly that was seen in respect
of the support to little Estonia when Russia tried to bully it.
I think there was less readiness to support Poland when it was
felt that the Polish government was exaggerating. Has there been
a noticeable warming of relationships after the elections in Poland?
Sir Anthony Brenton: The elections in Poland
have only just reached their conclusion. I think there are hopes
that that will make things easier. Estonia, again, was a very
interesting example because the actions that the Russian authorities
took against the Estonians were indefensible. I went and called
on the Estonian ambassador when she was besieged by youths shouting
abuse and throwing things at her residence. It was really indefensible
what was done there.
Q256 Lord Anderson of Swansea:
There were some attacks which were clearly officially agreed.
Sir Anthony Brenton: Indeed. It seems to me
that the fact that the EU, which, again, three years ago would
have been much less able in a unified way to have come out in
support of Estonia, did do so, is a very good sign of growing
EU convergence on these points.
Q257 Lord Anderson of Swansea:
Are there other signs of that nature? Certainly from the EU point
of view it is rather good that Chancellor Schroeder is no longer
there and Chancellor Merkel has taken a rather more hard-nosed
position in respect of Russia.
Sir Anthony Brenton: I could not possibly comment
on that, of course, but I think a key upcoming test is going to
be the Energy Directive because that is something that the Russians
are genuinely interested in. We, the EU, have a very strong interest
in being able to negotiate jointly with Russia over energy issues.
Russia has become able, because of differences of national interest,
because of differences of general political approach to Russia,
to deal with the EU states separately on this absolutely crucial
issue in our future relations, and for the EU to come together
and to establish joint terms, for example, on the conditions in
which Gazprom will be able to invest in Europe seems to me to
be very important for the future.
Q258 Chairman:
Kosovo will presumably be a rather difficult problem both for
the EU and Russia in the next few months.
Sir Anthony Brenton: I think Kosovo is going
to be very difficult.
Q259 Lord Anderson of Swansea:
If I can pick up on Kosovo, some commentators have talked about
some grand compact, of Russia trading views on frozen conflicts
with a move on Kosovo. Is there anything that you are aware of,
or is it still something on which Russia is not moving at all?
Sir Anthony Brenton: I have not seen anything
of that sort in the negotiations to which I have been privy, nor
have I seen Russia move at all on the issue of Kosovo, where their
position is that, unless Serbia agrees, Kosovo cannot become independent.
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