Global Governance
What Expects Relations Between Russia and Europe?

When the head of the Russian Foreign Ministry speaks of Russia’s readiness to cut relations with the European Union, it is, of course, a formal reflection of what the parties have already achieved in reducing the real volume and content of these relations, writes Valdai Club Programme Director Timofei Bordachev.

There are now radical changes being introduced to the entire system of relations between Russia and Europe, which had developed over the course of the past 30 years. While these seem quite dramatic, in a few years we will be living in a new reality. In practical terms, this reality will not be very different from the way things are now. Russia’s political break with the European Union can hardly be considered apocalyptic.

It doesn’t entail anything akin to the dire consequences of Brexit, when trade, economic and human ties that had developed over several decades were disrupted.

Russia has never been, and could not be a participant in the Common Market of the European Union, and the consequences of faltering political relations will not become so noticeable for the economy. First of all, because in reality the parties did not create ties that are so vital that severing them would leave both parties nursing their wounds. The main reason is the EU has been unwilling to make decisions over the years that would allow bilateral relations to move from words to deeds.

Global Governance
Russia and Europe: The Long-Awaited Finale
Timofei Bordachev
Since September 2020, a new stage of Russian policy begins in relation to its formerly most important neighbour and still the most significant foreign economic partner. Russia no longer believes that Europe is capable of playing the role of an independent and somewhat reliable partner in international affairs, writes Valdai Club Programme Director Timofei Bordachev.
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Moreover, over the past 10 years, relations between Russia and the European Union have already undergone an extensive trajectory of degradation, and now it is difficult to find anything that really resembles the “golden” era of 1991-2005. Therefore, when the head of the Russian Foreign Ministry speaks of Russia’s readiness to cut relations with the European Union, it is, of course, a formal reflection of what the parties have already achieved in reducing the real volume and content of these relations. Despite the importance of such statements from such an authoritative source, the impression they made is connected not with the expected real consequences of a possible radical adjustment, but with the emotional perception of the European focus of Russia’s external relations.

In fact, the faltering of Moscow’s relationship with Brussels does not mean anything special. From a symbolic point of view, fundamentally new conditions have been introduced to the relationship, which will be impossible to ignore.

The most important thing is the need for both parties to alter the nature of their dialogue, which will make it impossible to hide dissatisfaction.

But first, let’s try to determine the true nature of the relationship between Russia and the EU and decide what aspects we consider valuable.

After the start of the military and diplomatic crisis concerning Ukraine, bilateral trade between Russia and the European Union countries, as well as technological cooperation between them, was subject to serious non-commercial restrictions. In response to the measures of economic pressure that the EU countries took against Russia after the events of the summer of 2014, the Russian government imposed restrictions on access to its market for a number of European goods — primarily agricultural products. The technology exchange has also been disrupted by sanctions against Russian companies related to Crimea. At the same time, investments of the leading EU countries in Russia grew during the same period — here the leading positions are occupied by France, Germany and Italy.

Negotiations on a new basic agreement between Russia and the EU, which have been conducted since 2007, also actually stopped in December 2010. The reason is the unwillingness of the parties to determine the most important parameters of mutual market openness after Russia entered the WTO. The current Agreement on Partnership and Cooperation within several years came into conflict with the commitments that Russia assumed within the framework of the Eurasian Economic Union. So, in terms of its structure and content, this agreement is a relic of the 1990s, when even such large partners as Russia had to act under the pressure of Brussels. The main related condition is the linkage of progress in the economy with the fulfilment of targets for political changes, reflecting the position of the EU. This is no longer relevant for Russia.

Numerous political institutions, from summits at the highest level to working groups of Russian departments and divisions of the European Commission, stopped to function after 2014. The idea of holding summits has not been discussed so often since 2008, and this shows that the parties realised that this format was exhausted. It was truly unique — no major country in the world was so generous to the EU that the head of state met with its top bureaucrats twice a year.

The dialogue on visa-free travel, which had long been of great importance for Moscow, was also interrupted by the European Union, even before the Ukrainian crisis. Despite the fact that the parties carried out a lot of preparatory work, the final decision on the free movement of citizens was never made. The reason is the desire of Brussels and the leading European states to preserve the visa issue as a tool for encouraging individual countries of the former USSR to participate in the institutional formats of relations promoted by the EU.

The dialogue between Russia and the EU in the field of regional security was fragmentary for a long time and was not utilised to address important issues. In fact, it completely died out after the EU countries torpedoed the initiative of Russia and Germany, proposed in summer 2009, to create a permanent mechanism for dialogue in the field of defence and security. Here Russia and Europe communicate quite successfully at the level of interaction between Moscow and NATO, as do the governments and military leadership of both sides.

After the political relations between Russia and the EU are severed or are significantly reduced, the main burden of the work will fall on the interaction between the Russian departments, as well as the Eurasian Economic Commission, and the national governments of the European Union countries.

It would be inappropriate for Russia to come up with an initiative to terminate the 1994 Agreement; it can, in some respects, be used by Russian and EU-based companies to simplify interaction.

All trade and economic ties will be successfully carried out within the framework of relations with companies from the EU member states. We all watched the Finnish Foreign Minister’s visit to Russia and the business-like atmosphere. The only thing that EU companies can risk is difficulties in obtaining a loan to work in the Russian market. This, however, is already their problem — after the events of 2014-2015, investments from the leading EU countries in Russia only increased. There is no reason to think that national governments will allow someone in Brussels to hinder their business in Moscow.

The strength of the state determines whether it seeks to change reality in accordance with its policy, or adapt its policy to the requirements of reality. For quite a long time, Russia has had to follow the second prescription and patiently adjusted itself to the demands of the external environment. It is not surprising that the European Union, whose countries collectively lead in Russian foreign economic relations, occupied a central place in this demanding reality. However, now the parties no longer need political support for their already fairly stable economic relations.

Despite the fact that over the past 10-12 years Russia has significantly increased its trade and investment with Asian countries, primarily China, Europe remains the most important destination for Russian exports of natural resources and Russia’s largest source of foreign investment. However, the independent role of Brussels, especially of its political bodies, is now not only minimal, but simply absent. Therefore, there is no reason to believe that the formal termination of the political dialogue with the European Union as an institution will significantly change this situation.

Russia and Europe: A Problem of Strategic Intentions
Timofei Bordachev
The systemic crisis in Russia-EU relations is five years old. The military and diplomatic fallout over Ukraine has resulted in the curtailment of practically all forms of working cooperation at the governmental level, as well as reciprocal sanctions and trade restrictions. At the same time, there are still institutions supporting expert and business dialogue.
Expert Opinions
Views expressed are of individual Members and Contributors, rather than the Club's, unless explicitly stated otherwise.