THE EUROPEAN UNION AND RUSSIA
CHAPTER 1: INTRODUCTION
1. The European Union's relationship with Russia
is highly topical, as Russia embarks on a new phase of the post-Soviet
era under a new President, Mr Dmitri Medvedev. The relationship
is high on the agenda of the European Union (EU) and likely to
remain there. In this report we look at developments in Russia
and in the European Union and examine whether the present European
strategy for relations with Russia including the mandate for the
negotiations on a new Partnership and Cooperation Agreement (PCA)
is appropriate and whether enough is being done to determine relevant
strategies.
2. The enlargement of the EU to include countries
which were formerly part of the Warsaw Pact and of the Soviet
Union itself requires a careful review and reassessment of the
EU's overall interests and relationship with Russia. This is despite
the fact that the division between "old" and "new"
Europe was never clear cut, and it is fading as the "new"
Member States find themselves involved in a shifting pattern of
tactical alliances in order to promote their national interests
in Brussels. Without such a review of the relationship with Russia,
the EU will continue to find itself ill-prepared in its dealings
with its most important neighbour.
3. The European Union defines its relationship
with Russia as a "strategic partnership", one of eight
such partnerships, the others being with the United States, Canada,
Japan, South Korea, China, Brazil and India. The European Commission's
current strategy towards Russia is set out in its Country Strategy
Paper for 2007-2013, of March 2007[1]
which describes the strategy as a "robust and coherent approach".
The paper states that:
"[T]he main interests of the EU in Russia lie
in fostering the political and economic stability of the Federation,
in maintaining a stable supply of energy; in further cooperation
in the fields of justice and home affairs, the environment and
nuclear safety in order to combat 'soft' security threats; and
in stepping up cooperation with Russia in the southern Caucasus
and the western [Newly Independent States] for the geopolitical
stability of the [Commonwealth of Independent States] region,
including for the resolution of frozen conflicts. EU cooperation
with Russia is conceived in terms of, and is designed to strengthen,
a strategic partnership. The EU places emphasis on the promotion
of democracy, the rule of law and good governance in general,
as well as respect for human rights and fundamental freedoms."
4. The institutional framework for EU-Russia
relations is based on the PCA, which entered into force in 1997
for a ten year period. The Agreement, which we discuss in Chapter
3, defines the main objectives of EU-Russia cooperation, establishes
the institutional framework for bilateral contacts, and calls
for activities and dialogue in a number of areas. It is a "mixed"
agreement covering matters falling under both EU/EC competence
and Member State competence. The relationship was extended with
the adoption of a new basis for long-term cooperation in 2003,
structured around four themes or "Common Spaces": a
Common Economic Space; a Common Space of Freedom, Security and
Justice; a Common Space on External Security; and a Common Space
on Research, Education and Culture. We discuss these in Chapter
4. The PCA has now reached the end of its term, but its provisions
pending the negotiation of a successor continue to apply. These
negotiations have been held up due to concerns among some EU Member
States, notably Poland and Lithuania.
5. In evidence to the Committee, Sir Mark
Lyall Grant, Political Director, Foreign and Commonwealth Office
(FCO) set out the British Government's assessment of the relations.
He thought the EU/Russia relationship was important for their
common strategic economic and political interests. Russia and
the EU were dependent on each other in the energy field and Russia
needed EU direct investment particularly in the technology of
the hydrocarbon sector. He saw a strong coincidence of interests
in financial and international matters: "The City of London
has become the centre of choice for Russian business in terms
of capital … [with] a record number of initial public offerings
by Russian companies" in London. The EU and Russia also needed
to co-operate on wider political issues "Iran ... Kosovo,
the Middle East, Sudan, climate change, the global challenges
in … counter-terrorism, … non-proliferation … drug-trafficking
and organised crime," all of which were common challenges
(Q 1).
6. The original strategy of the European Union
towards Russia was based on the assumption that Russia and Europe
share "common values", and that building closer economic
and political relations with Russia are both desirable and possible
in the short term. We look at whether this assumption reflects
the reality of Russia and the EU today. There is no doubt that
in key areas the EU and Russia need to work together, for example
on energy: Russia is a major source of oil and gas supplies for
a number of EU countries. Security of supply is an issue of considerable
importance in the context of the EU-Russia energy relationship.
At the same time the Russian energy industry has benefited from
the investment and expertise of European companies. In Chapter
5 we discuss energy issues including the Energy Charter Treaty
and its Transit Protocol and the important issues of the ownership
and control of energy production and transport, and particularly
the question of gas pipelines.
7. The relationship between Russia and the European
Union is, however, going through a bad-tempered phase. There are
disputes over energy supplies, and over foreign policy issues.
There are some bilateral disputes, such as that over the British
Council, which the Russians are pursuing with a counterproductive
mixture of intransigence and self-righteousness. The Russians
resent criticism by the European Union and its Member States over
what the latter see as the decline of democracy and the growth
of authoritarianism in Russian politics. The formal arrangements
which should govern the relationship—a renewed PCA and the
Energy Charter Treaty, which we discuss in Chapter 5—are
stalled, in part because the Russians consider that their provisions
are one-sided.
8. The challenge for the European Union is to
devise common policies which enable it to deal with Russia as
an equal in the promotion of common interests, but also to act
effectively when it comes to defending its own interests and those
of its Member States. It is a central theme of our Report that
the European Union has the greatest influence and negotiating
leverage when it has coherent policies that are supported by the
EU institutions and the Member States and speaks with one voice.
Both the EU and Russia have an interest in working closely together
to tackle issues of common concern.
9. One of our witnesses, Katinka Barysch, of
the Centre for European Reform, summed it up thus: "It is
time the EU gave up pretending that the relationship is something
that it is not. The EU's governments and institutions need to
start an honest and forward-looking debate about their Russia
policy. This debate should involve at least three issues: a clear
definition of what the different EU members want and need from
Russia; a sober assessment of how much influence the EU has over
its biggest neighbour; and contingency plans in case things in
Russia turn out better or worse than policy planners [expect]."[2]
10. The rest of this Report is divided into seven
Chapters:
In Chapter 2: Russia Today, we discuss the
European character of Russia; and look at the present state of
Russia's domestic politics, its economy, and its foreign relations.
In Chapter 3: The Institutional Framework for
EU-Russia Relations, we analyse the institutional and legal
framework for conducting the relationship.
In Chapter 4: Building Cooperation through the
Four Common Spaces, we take a closer look at the four main
policy areas of EU-Russia relations.
In Chapter 5: Energy, we deal with European
dependence on energy supplies from Russia and the politics surrounding
it, the prospects for the Energy Charter Treaty and its Transit
Protocol, and the nature of future EU energy policy towards Russia.
In Chapter 6: The Common Neighbourhood and International
Issues, we examine foreign and security policy issues.
In Chapter 7: Managing the EU's Strategy towards
Russia, we take a look at how the European Union manages its
relations with Russia overall, including the question of whether
the EU can influence Russian policy on democracy and human rights.
In Chapter 8: Summary of Conclusions and Recommendations,
we set out our overall conclusions and recommendations.
11. This Report was prepared by the European
Union Sub-Committee C whose members are listed in Appendix 1.
The list of those from whom we took evidence, to whom we are grateful,
is listed in Appendix 2. We are also grateful to our Specialist
Adviser, Sir Rodric Braithwaite, former British Ambassador
to Russia. The Sub-Committee visited Russia and the record of
our discussions is in Appendix 4.
12. We make this report to the House for debate.
1 European Commission website: www.ec.europa.eu/external_relations/russia/csp/2007-2013.en.pdf
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2
Centre for European Reform pamphlet Three Questions that Europe
must ask about Russia, CER briefing note, 16 May 2007. Back
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