Luc Brunet – 4 March 2014
As events in the Ukraine are still unfolding, and rightly create a lot of emotion and all sides, let’s take a step back a look at the options.
The first thing to consider is the will of the people of Ukraine. We see many people wishing to join the EU and follow the path of Poland or Czech. But there are also people in the Ukraine who feel closer to Russia, in Crimea but also in many other places.
Now let’ forget about Russia for a while and just try to imagine the consequences of the above. What pro-EU Ukrainians want is not a simple agreement as was discussed during Yanukovich times, but they want to join the EU for good. But is the EU in a situation to accept that?
I believe the answer is a clear no, but as usual (see what happened with Turkey), EU leaders are too weak to take bold decisions and prefer to entertain hope even when there is none, an attitude that can have very bad consequences. The Ukraine is indeed a large country of around 45 million, with 2 major segments in its economy, agriculture and heavy industry. The heavy industry part is located in the eastern part of the country, the one feeling closer to Russia, and is mostly soviet times industry, obsolete on EU standards, selling a large majority of its production to…Russia. The agriculture segment is more palatable for the EU, although difficulties shall also be significant, looking at the already fragile EU agriculture and the continuous efforts of the Commission to suppress subsidies to that segment.
If you add the existing debt problems of the EU, I do not think they are ready to integrate the Ukraine. If they do for political reasons (a la East Germany), the pill may be mortal and lead to the explosion of the EU as such, as populations in Europe shall not be ready to pay for the integration. However popular the Ukrainian cause is today for many Europeans, they shall not accept more taxes for a further eastern expansion, or rather they simply do not have more money.
The Ukraine shall then more probably end up with a weak treaty with the EU, and a loss of its major customer Russia, not to talk about more expensive gas. Such a situation is not sustainable, as Eastern regions industry shall go bankrupt in a matter of months, and miners shall again take the train to Kiev, but this time not to please uncle Vitya (Yanukovich), but because their families have nothing to eat. The difference is very very big!
In other terms, the Ukraine needs to achieve two things: be integrated in the EU and keep its eastern industry alive and selling to Russia. But the two things are incompatible.
Ukrainians who want to join the EU are in a dead-end as long as the country remains in one piece. If there is a split, the western regions as a new entity become palatable for the EU, not easily, but at least with reasonable chances of success. The new country has the advantage to be homogeneous and manageable. Negotiations should be done in a way for that new Ukraine to keep an access to the sea, and integrate the city of Odessa, the nicest city on the Black Sea, that could become a favorite destination by car for many central European tourists.
Eastern Ukrainians on their side would either create a new entity of join Russia, but they could maintain their source of revenue from the industry.
Only a negotiated compromise can save the region from a war, that would anyway bring a similar result after its end, assuming it does not turn into a disaster like Syria.
It is time for Russia and the West to sit down and negotiate, push their respective allies in Ukraine to accept a compromise. Yes this is not in-line with guaranties given to Ukraine in 1994, and this shall be tough to accept for many Ukrainians, but this is the only viable solution. Again, even if Russia suddenly steps back, recognizes the Kiev government and all its decisions, the scenario shall end-up in a failure because parts of the country simple have opposite politic and most importantly economic interest. At a time when several EU countries may split, like Spain or UK and may be Italy on the long term, this should not be considered as a shame. This is fact of life and nobody should die because of that!