July 3, 2018 / 8:48 PM / a year ago

Commentary: A Ukrainian economist on the perils of Trump's Putin policy

Vladimir Putin is showing no signs of easing his hostile policy towards Ukraine. In recent comments to Austria’s ORF network and a nationwide phone-in on Russia TV channel Rossiya, he stressed that Russia will not return the annexed area of Crimea to Kiev – and warned that any attempt to recover areas of Ukraine’s Donbass will result in “dire consequences for Ukraine’s statehood.”

A picture of President Vladimir Putin is held at a Sevastopol rally marking the fourth anniversary of Russia's annexation of Crimea, March 14, 2018. REUTERS/Maxim Shemetov

Moscow is skillfully exploiting Western leaders’ divisions and disagreements on issues ranging from the U.S. withdrawal from the Iran nuclear accord, to the Nord Stream 2 gas project that will increase gas flow from Russia to Western Europe, to U.S. tariffs on its trading partners. In addition, Putin has fomented nationalism in Europe by supporting far-right parties; generated political tension through Russia’s interference in the 2016 U.S presidential election and allegedly made donations to prominent supporters of Britain’s Brexit campaign – all the while continuing to threaten and bully countries like Ukraine and Georgia.

With U.S. President Donald Trump about to hold a summit with Putin on July 16, it’s become even more urgent for Europe and the United States to set aside their differences and muster the moral might and diplomatic vision to stop the Russian leader from dictating the future of Eastern Europe and the course of Western democracy.

For Ukraine’s conservatives, the indifference shown by Western powers to Russia’s spiraling aggression is reminiscent of the pre-World War Two policy of appeasement employed against Nazi Germany. The same week that Putin made his hardline statements on Ukraine, Trump ignored opposition from other G7 leaders about his plans to meet Putin and the suggestion that Moscow should be readmitted to what was previously the G8. Since then, Secretary of State Mike Pompeo has told the Senate Appropriations Committee that “trade-offs” could allow Moscow to rejoin the group without returning Crimea to Ukraine.

Economic sanctions have been the West’s main leverage over Putin since the 2014 Crimea annexation. But as Russia’s economy benefits from the rise in commodity prices, the motivation for Putin to back down on Ukraine will diminish. Meanwhile, Western countries and companies continue to pursue energy deals that undermine their own security while simultaneously sending a contradictory message to Ukraine. Germany’s decision to support the controversial Nord Stream 2 project – which will allow Russia to re-route gas to Western Europe by bypassing Ukraine – ignores a long pattern of the Kremlin using its stranglehold on natural gas to get its own way. A recent arbitration ruling in Stockholm awarded Ukraine’s Naftogaz $2.56 billion in compensation for Russian energy giant Gazprom’s past decisions to cut Ukraine’s gas supply, leaving millions to freeze. Gazprom remains a U.S.-sanctioned entity, but Moscow is intensifying its lobbying for an end to sanctions.

Trump, along with Italian Prime Minister Giuseppe Conte, appears to believe that getting closer to Putin will strengthen the West’s hand. But if anything, the U.S. president has strengthened Russia’ negotiating position. As Moscow’s stance on Ukraine remains unchanged, it seems unlikely that the Trump-Putin summit will win concessions from the Kremlin.

While German Chancellor Angela Merkel and other members of the G7 have stated that there can be no rapprochement with Russia until the question of Ukraine is resolved, the extent to which Germany can stand firm against Russia and Italy is now debatable. Meanwhile, German energy deals with Kremlin-owned gas companies amounts to tacit collusion with Russia, which effectively uses hybrid economic warfare to undermine Ukraine’s sovereignty.

Merkel must back words with actions, particularly in respect to business with Russia. During a May meeting with Putin in Sochi, Merkel repeated her support for Nord Stream 2, but said that Germany wants Ukraine’s role as a transit country to continue. Billions of dollars in gas transit fees currently paid to Ukraine will be lost when the pipeline is complete, while trade rivalry between the United States and Europe may affect growing Ukrainian exports to the European Union. Meanwhile, Russia has limited access to the Ukrainian port of Mariupol, and the increasingly-tense Sea of Azov. The construction of a bridge across the Kerch Straits, which links the Russian mainland to Crimea, will cement Putin’s hold over the peninsula.

The West must offer greater support to Kiev and real guarantees that anchor Ukraine in Euro-Atlantic structures. Ukraine surrendered its post-Soviet nuclear arsenal when it signed the 1994 Budapest Memorandum on assurances of security by the international community. As war persists in the country’s east, with limited Western support and access to arms, many Ukrainians feel betrayed.

The West needs to offer practical steps to bolster Ukraine’s security and to strengthen economic sanctions, not lift them. There is a need for appropriate military assistance, and help to deflect cyber-warfare. The West should also review the conflict resolution mechanism of the Minsk-Normandy accord, which has neither brought peace to eastern Ukraine, nor altered Putin’s approach to Ukraine.

Ukraine’s policy reforms since 2014 have been significant, but there is still a need to fight corruption and stimulate economic growth. Ukraine’s conservatives want a state built on national and European values – one that’s driven by a strong economy, independent institutions, and a tolerant civil society. As 2019 elections approach, the West can help to support transition from the quasi-plurality of past decades to true democracy, where voters really have their say.

Ukraine understands the fragility of freedom. Brave Ukrainians lost their lives in the 2013-14 Revolution of Dignity that deposed the Russian-backed Viktor Yanukovich; over 10,000 soldiers and civilians have since been killed in the country’s east. The only way to honor their sacrifice is to build the pluralist, European democracy that they died to create. When Trump meets Putin in Helsinki, the U.S. president should realize that the transatlantic community has two clear options. It can bow to Putin’s tactics while simultaneously selling out Ukraine. Or it can refuse a dictator’s phony détente. 

About the Author

Igor Kryvetskyi is a center-right policy reformer and economic analyst in Ukraine. A former lawmaker and politician, Kryvetskyi was a member of parliament for the Svoboda Party.

The views expressed in this article are not those of Reuters News.

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