Russia’s New Offensive in Central Europe

Posted in Russia | 08-Dec-08 | Author: Géza Jeszenszky

Géza Jeszenszky is member of the WSN International Advisory Board.

Western observers tend to think that Central Europeans, and particularly those nations who in history stood up to Russia’s encroachments (particularly Poles and Hungarians), entertain an exaggerated fear; one may say prejudice towards Russia. Notwithstanding memories of their 19th century wars of independence suppressed by Russia, or more recent Soviet applications of the Brezhnev Doctrine, in the bliss of 1989/90, impressed by Gorbachev’s renunciation of force to be applied against his unwilling satellites, most Central Europeans felt no animosity towards their former masters. In fact quite a few Hungarians remember fondly that in the last decade before their 1991 departure the soldiers of the occupying forces sold gasoline and many other products rather cheaply on the black market. With the peaceful break-up of the Soviet Union any residue of ill-feeling disappeared, in fact we felt very sorry for the Russian people, who suffered so much under Communism. We, Central Europeans, welcomed that the desire for freedom apparently did not disappear among Russians under the permafrost of Communism, and were ready to establish a new relationship with Yeltsin’s Russia, based on mutual interests. We signed treaties and concluded various agreements with the Russian Federation, which appeared to have made a genuine break with the past, both with Communism and with the much older imperialistic policies towards the peoples living west of the Russians. I often said: “How lucky the world was that Yeltsin did not follow the example of Milosevic by saying: all Russians must live in one state.” For twenty-five million Russians, Russia overnight became abroad, a foreign country. Indeed fourteen independent states and nations reemerged on the map of Europe and Central Asia. Diplomacy became a growth industry, as the current joke went. Whereas eleven former Soviet republics established the Commonwealth of Independent States, apparently seeking a better future for themselves through continued close cooperation with each other, the former members of the by now dissolved Warsaw Pact turned toward Western Europe and the United States, to the western integration structures, hoping to find there both security and prosperity. That held out the hope that history would not be repeated, that domination and misrule represented by a Russian Great Power would never come back, that the bear would cease to be a menace.

The first qualms appeared in December, 1992, with the famous speech by Foreign Minister Kozyrev in Stockholm, but he reassured his audience that it was just a joke, a warning that different policies might prevail in Russia if, in response to unfriendly or just unhelpful policies by the West, the “red-brown forces” would triumph over the Russian democrats. I started to have doubts about the future course of Russian policy when a few of their politicians and observers started to speak out in support of the conduct of Yugoslavia when even the oldest sympathizers of the Serbs (the British and the French) were turning against them on account of the war crimes committed in Croatia and Bosnia. Neither did I like the term “near abroad” applied to independent states which had earlier been under Soviet domination. Then Minister Kozyrev, so far the most pro-West Russian politician, stated in January 1994: "The countries of the CIS and the Baltic are the region where Russia's primary vital interests are concentrated. They are also the source of fundamental threats to those interests... We must not abandon these regions, which have been Russian spheres of interest for centuries. And we must not be afraid of saying this."1 On an official visit to Hungary in March 1994 Kozyrev, with whom I had an excellent personal relationship, said that even Sarajevo was within the Russian sphere of interest. Voices like that, and much stronger ones coming from the Russian Duma only increased the drive of the Visegrad countries towards NATO membership. The more Russia opposed that endeavor the more the Central Europeans felt the need to join an alliance which guaranteed the independence of its members. Following the first round of enlargement in 1999 (three “Visegrad” states) the “Vilnius Seven” (the remaining former members of the erstwhile Warsaw Pact plus Slovenia) pressed up their campaign for membership in the Atlantic Alliance, and reached that goal in 2002. Russia apparently acquiesced in this “Big Bang,” and NATO indeed projected stability into a region which once was full of mutual tensions and territorial squabbles.

Whereas Russia never stopped showing a strong interest for its immediate western neighborhood: the Baltic States, Belarus, Ukraine and Moldavia, with Putin’s presidency a new Central European policy emerged soon. The tanks were to be replaced by shares in companies, especially in those related to the supply and processing of hydrocarbons. In the energy sector the dependence of Central Europe on Russia did not change much, and as the demand for natural gas grew it increased rather than decreased. Janusz Bugajski demonstrated both what looks like a “Putin Plan” and its execution in his admirable book, Cold Peace.[2] According to him long-term Russian objectives include “to gain increasing economic benefits and monopolistic positions through targeted foreign investments and strategic infrastructure buyouts in Eastern Europe. This can supply Moscow with substantial influence over any country's economic, financial, trade, and investment policies.” (p. 31.) This web of commercial and financial ties buttress political penetration. Nowhere is that more evident than in the energy sector: “Putin has focused on energy as an important factor in foreign policy and the energy companies have become tools of the state leadership. […] The Kremlin calculates that it would be more profitable and politically advantageous not only to control energy supplies but also to refine and sell the final products. Russian company buyouts and ownership of key oil and gas infrastructure in Eastern Europe, such as pipelines, refineries, and storage sites, enables Moscow to uphold additional leverage. Control of energy transport systems has become one of the major elements in Russia's strategy toward former satellites. The energy industry became awash in cash during the last decade and could use these resources to purchase infrastructure and other assets.” (p. 37.) In Hungary takeover attempts by Russian companies started already in 2000. For a while the Hungarian chemical firm BorsodChem and others resisted the efforts of little-known Irish, Austrian and various off-shore companies, all having a Russian management, to gain a majority in shares, but with the Socialist Party winning the elections in 2002 the Russian bids, with Gazprom behind them, became successful. What at first appeared to be only a plan in the imagination of nervous Central Europeans who had a long memory, a Russian economic penetration into the former Soviet empire, became an accomplished fact by 2006.

Putin’s visit to Budapest and Prague in March 2006 opened a new phase in this offensive. While less successful in Prague, the Socialist-led coalition in Budapest welcomed the chance to boost its trade with the Russians, in exchange for supporting the gas pipeline Blue Stream (later renamed South Stream) over the EU-backed Nabucco project. Malév, the Hungarian airlines, was sold to the Russian Air Bridge Company in February, 2007, despite an offer, backed by the EU, which appeared to be better. A year later the Hungarian government hastily signed a contract about a very expensive gas pipeline under the Black Sea through Bulgaria and Serbia, to sidetrack Ukraine and Romania. The terms of the contract do not look advantageous for Hungary, they increase our dependence on Russia without guarantees to have a say over the use of the pipeline. The details have not been made public and it is not going to be submitted to Parliament for approval, although it would determine Hungary’s energy supply for 30 years. In the last year we also witnessed several attempts by Gazprom (usually in the guise of other companies, most notably OMV, nominally an Austrian company) to take over MOL, the large oil company, presumably still having a Hungarian majority among the shareholders.

Hungary is the central piece in the Russian buildup. Our northern neighbor, Slovakia, has a tradition of Pan-Slavist proclivities, going back to the 19th century. During World War II Slovak communists were entertaining the idea of joining the Soviet Union as a member republic. The present Slovak government led by Robert Fico has just approved the construction of an extension of the wide-gauge Russian railway to Bratislava, with the likelihood of ending it in Vienna. The political opposition considers the project totally superfluous. Slovak support for Putin’s foreign policies was manifest recently in vehemently opposing Kosovo’s independence, and also in denouncing a missile defense system to be deployed in Poland and the Czech Republic. Rather than attending the NATO summit in Bucharest, the Slovak Prime Minister stayed at home to welcome his Russian counterpart.

South of Hungary there are two other old Russian protégées, Serbia and Bulgaria. Russia’s stand over Kosovo raised its popularity in Belgrade to a fever-pitch, some even advocating Serbia’s incorporation into Russia. Bulgaria, too, started to realize its plans, announced earlier, to boost its economic ties with Russia. That goes beyond the recently signed agreement over South Stream, which was described by the International Herald Tribune as Putin’s redrawing of the energy map of Europe. (January 18, 2008.) On January 23, 2008 the New York Times reported: “Four days after signing a major pipeline deal with Bulgaria, the Russian state-owned energy giant Gazprom agreed to buy a 51 percent stake in NIS, the Serbian state-owned oil company. The deal was yet another blow to the European Union’s ambitions to build its own 2,000-mile pipeline to bring gas to Europe from Iran and Azerbaijan via Turkey, analysts said.” Critics of the government said the deal was bad both politically and economically.

Bulgaria, Hungary and Slovakia are members of NATO and the EU, which makes them more attractive for the new Russian economic offensive. The results, and even more the perspectives, have serious political connotations. Deplorable are the special agreements Germany, France and Italy have concluded with Russia in the energy front, but they do not jeopardize the economic, let alone political independence of those countries. Former Communists, with important family and business connections to Russia, hold important political, military and media positions in those three countries. Lip service being paid to western values should not be taken at face value.

George Schöpflin, a Hungarian member of the European Parliament who grew up and spent the larger part of his life in the U.K., calls Putin’s Russia a “consensual authoritarian state, [which] can act more aggressively than a traditional authoritarian system.” He recently warned that apart from the capacity of its large state-owned companies to outbid their foreign competitors „the chances are high that the authoritarian assumptions of the state of origin will be transmitted to the democratic economic space abroad in which it is seeking to operate.” (My italics.) „Most vulnerable are the former communist states, where the rule of law is not trusted and the habits of mind of seeing the law as a political device live on still. Here Russia has another advantage, the networks of influence from the communist period may have been neglected during the Yeltsin period, but are being reactivated currently.”3 A young Hungarian analyst, Anita Orbán4, wrote in a recent essay: „After its diplomatic failures to contain NATO’s spread in the mid-1990s, the Kremlin has developed a new strategy, laid out in a 1997 study, calling for economic expansion in the region to counterbalance Western influence. It was a strategy that in a few years would lead President Vladimir Putin to call Gazprom an essential tool of foreign policy. In the last eight years, Russian companies entrenched their monopolies over the region’s energy supply, acquiring key energy infrastructure in Slovakia, Hungary, and Bulgaria. Their motives are obvious: a foreign power that controls both the supply and distribution of energy in a country will be able to control or at least strongly influence its domestic and foreign policies. […] Russia’s creeping economic expansion threatens the democracies and their market economies of these relatively new NATO members from the Baltics to the Balkans. It is a well-known fact that Russia is encouraging non-transparent business practices that evade the rule of law. If Russia succeeds and controls these strategic industries in Central and Eastern European countries, it will have a spillover affect on their overall economies. Investments of this scale also serve to ‘cover or mask’ other activities in the region. The Hungarian secret services noted in its annual report in 2006 that Russian intelligence activity had visibly increased in the Hungarian bureaucracy and business circles.”

The tools employed by Russia in Central Europe are not restricted to business and high-level contacts. As Bugajski pointed out: “An additional measure for influencing public and political opinion is the purchase of major media outlets in targeted states, especially television stations and popular newspapers with a wide audience. Russian businessmen with ties to the Moscow authorities have endeavored to acquire majority shares or outright ownership of media outlets in a number of countries.” (p. 33.) What has not been noted, however, that such Russian influence often appears in the guise of right-wing radicalism. For example it is more than likely that in several seemingly rightist Hungarian, Romanian, Slovak, Serb etc. press organs there is a heavy Russian hand. I am familiar with some which are suspiciously friendly to Putin and his policies (had only praise for the recent Russian elections), while viciously hostile towards the U.S. They also have a love-affair with Hugo Chaves and Evo Morales, and also with radical Arab movements. Their line serves two purposes: compromises the center-right in the eyes of the U.S., and misleads the conservative-leaning public by suggesting that “globalization” symbolized by the U.S. is what threatens Central Europe, not a more active Russia.

Despite the obvious attempt by Russia to drive a wedge into NATO and into the EU, despite the language Putin used not long ago at Munich, and now at Bucharest, despite the resumption of the military parades at Red Square, I do not want to ring the alarm bells that “Putin ante portas,” that Russia is back as the adversary of the free world. I only want to warn: vigilant consules, the leaders of the western democracies should be watchful of the potential dangers. A famous, shrewd aggressor once put it: "there had never been spaces without a master." Central Europe today is no longer a no-man’s land, but in my opinion aggressive tendencies in Russia should not be given a chance to try turning back the wheel of history. Scoring even a small success just wets the appetite of ambitious politicians. If they see openings and opportunities they would not hesitate to use and try to expand them. Despite its unequivocal position on dangerous powers like Iran, Russia is not a security threat today. But it is characterized by wide-spread corruption, it is notorious for turning away from democracy and press freedom, and for the close relationship between criminals and business. Russia represents also many health hazards; it shows a bad example in its intolerance of political criticism, its attitude towards its non-Russian citizens, its negligence of the environment. Many of those tendencies exist in Central Europe, too. Closer association with Russia would certainly strengthen those tendencies.

At the end of World War II Central Europe was left to the tender mercy of the Soviet Union, mainly as an unforeseen consequence of flawed Allied strategy, because Central Europe was considered to be of no great importance for the U.S. Eighteen years ago, thanks mainly to American leadership, and by making use of a favorable moment in Soviet policy, we managed to liberate ourselves. But the fear persist that Central Europe may be regarded by the U.S. as dependable. As an ally we cannot be abandoned again, but may be neglected. As Ryan Miller, a research analyst at the Center for European Policy Analysis in Washington, D.C., wrote recently: “From Moscow's perspective, Central Europe sits at the center of the chessboard, because the area between the Baltic States and the Black Sea are vital for Russia to re-establish its sphere of influence. Overstretched and confronted with a host of challenges requiring the Kremlin's cooperation, Washington may, under the right circumstances, find itself tempted to trade away Central Europe's security interests to win Russian cooperation on issues it considers more pressing. Besides Georgia and Ukraine, the issue of Iran's nuclear program could provide another opportunity for a trade-off with the Kremlin.”5

There are suggestions that the Central Europeans should not put blind faith in American support against Russian ambitions, taking it for granted. They should rather try to increase their value by flirting with Russia. Denis P. Cosgrove, a CEPA Associate Scholar based in Washington, DC., recently suggested „A few successful summits with Medvedev’s Russia would send a clear single [sign?] that Central Europe is no longer to be taken for granted by the United States or EU heavyweights.”6 I do not think that such play would bring any benefit; it would only undermine U.S. confidence in the new allies and would strengthen those who might advocate deals over the heads of the Central Europeans. If Central Europe sticks together, stand up jointly to aggressive tendencies, and presents a common platform in Allied discussions, they have no reason to be worried. That is what makes attempts to divide them so dangerous, and that’s why the public, the electorate in Central Europe should repudiate those leaders who are ready to play out, foolishly, the Russian card.

The European Union and NATO, led by the U.S., can jointly tackle the new Russia, by re-affirming the alliance and not entering into separate, egotist deals with Putin. At a German Marshall Fund conference on November 27, 2006 in Riga, Latvia Senator Lugar proposed to make the supply of energy an Article Five commitment in NATO. „We are used to thinking in terms of conventional warfare between nations, but energy could become the weapon of choice for those who possess it. It may seem to be a less lethal weapon than military force, but a natural gas shutdown to a European country in the middle of winter could cause death and economic loss on the scale of a military attack. Moreover, in such circumstances, nations would become desperate, increasing the chances of armed conflict and terrorism. […] The Alliance must commit itself to preparing for and responding to attempts to use the energy weapon against its fellow members. NATO must become a reliable refuge for members against threats stemming from their energy insecurity.” The Senator belongs to a generation who drew lessons from history. The younger ones should not be oblivious of the price the world had to play for appeasing first Hitler and then Stalin.

The transatlantic link is now strengthened by the new members, who still remember those lessons. They should not be considered for any bargain with Russia. Such a policy would eventually lead to the renewal of the confrontation between East and West. Eighteen years ago victory was achieved not by the West but by democracy, by respect for the law and for human rights, and by the chance for prosperity spreading to the poorer half of Europe. That victory should not be jeopardized by short-sighted policies pursued either by the Central Europeans or by their western partners.

* The author is a historian, teaching at Corvinus University of Budapest. He was Foreign Minister in the first non-communist government (1990-94) and Hungary’s ambassador to the United States (1998-2002).

1 Quoted by Mark Almond, Russia's Outer Rim. Integration or Disintegration? London: Institute for European Defence and Strategic Studies, 1995. p. 7.

2 Janus Bugajski, Cold Peace. Russia’s New Imperialism (Praeger, 2004)

3 György Schöpflin, “Authoritarian capitalism and sovereign economic actors,” Diplomaatia (Tallinn), Spring 2008.

4 Author of Power, Energy and the New Russian Imperialism (Praeger, 2008 forthcoming)