Russia is keen on developing stronger ties with both China and the EU in order to secure its global economic position. The recent agreement with China to begin Ruble-Renminbi trading in Russia is part of this effort. Last week, Marc Chandler also wrote about the increasing likelihood of Russia’s admission into the WTO framework. But clearly rapprochement with the European Union is central to Russia’s plans going forward. For Europe to turn toward the Russians, in part, this means it needs to turn away from the United States. And Vladimir Putin has been very vocal about this, calling dollar hegemony ‘dangerous’ while in Germany courting the EU last month.
Russia’s advances are being met with some scepticism.
Andy Lees writes:
Before arriving in Germany at the end of November, Russian prime minister Putin published an article in the German newspaper Suddeutsche Zeitung arguing that Russia and Europe need to work more closely together. “We propose the creation of a harmonious economic community stretching from Lisbon to Vladivostok”. He said “in the future we could even consider a free trade zone or even more advanced forms of integration”. He called for “active exchanges” in energy, working together “at all phases of the technological value creation chain from the uncovering of demand for energy resources up to the delivery to the consumer”. He also wants trade between the two blocs to be denominated in euros or rubles rather than dollars. Historically Putin has talked about forming the equivalent of the European Coal and Steal Community (the forerunner to the European Community) in energy. Markus Loening, head of human rights in the German government however has said that the latest trial of former oil magnate Mikhail Khodorkovsky “is a political trial” and German parliament speaker Norbert Lament however says that the trial indicates “Russia and its government have shown no interest in a rapprochement with Europe”, effectively linking any real development to the freeing of Khodorkovsky.
Europe’s problem with Russia has much to do with the lawless mafia/government linkages the WikiLeaks cables revealed. The Europeans do not want to hitch their wagon to a horse that could go starkers and break loose at any moment. Witness the recurring Ukrainian-Russian gas disputes that have held Europe hostage time and again. If Russia wants to court the EU, it needs to show that the Russian bureaucracy and courts respect the rule of law.