Toespraak Commissaris Ferrero-Waldner over de relatie EU-Rusland (en)

The European Union and Russia – future prospects

Salzburg Global Seminar – Russia: The 2020 Perspective

Salzburg, 6 April 2008

Dear Vice-President Mortimer,

Ladies and Gentlemen,

It’s good to be back at Schloß Leopoldskron. I would like to thank you for your invitation to share some ideas about the development of the European Union’s relations with our great neighbour: Russia. Sometimes vilified, sometimes glorified, but rarely understood properly.

The challenge of getting our relationship with Russia right and of exploiting our joint potential has turned into a major test of EU foreign policy and coherence. Nor is the EU alone in this exercise. Other international partners too are looking at the resurgent Russia and considering how best to adjust policy in the light of changing circumstances.

Generally, it is considered wise for politicians and diplomats to stay away from crystal balls and futurology. As Mark Twain said, “The art of prophecy is very difficult, especially with respect to the future”.

So I will base my remarks on how I see the EU’s relations with Russia developing in the short- and medium-term.

From what we have seen and heard so far, President-elect Medvedev stands for continuity, at least initially. It is true that many said the same about Vladimir Putin when he took over as President in 2000. But the scenario in 2008 differs in an important way: where Boris Yeltsin retired from political life, Vladimir Putin stays, and is likely to be confirmed as Prime Minister next month.When we discuss the future development of our relations with Russia, it is important to note the constructive mood that was visible at the NATO Summit in Bucharest and the US-Russia Summit in Sochi. Mutual confidence is being built, for instance regarding NATO’s missile defence plans. Also, I believe the Alliance’s decision on Ukraine’s and Georgia’s NATO membership aspirations was a wise compromise.

Of course, how the Medvedev-Putin-tandem will work out in practice remains to be seen, but Dmitry Medvedev does bring a change of style. In his public pronouncements, he has placed the emphasis on the rule of law, on modernizing the economy, and on reducing the State’s role in the economy. You will also recall his statement on the risks of "legal nihilism" in Russia.

All of this is very welcome, but ultimately the world will assess Mr Medvedev on his deeds, not just on his words. The next EU-Russia Summit, in June, will be a first opportunity for us to see how his policies will affect Russia’s relations with the European Union.

By then, we should have reached an agreement inside the EU on the mandate for the Commission to negotiate the New Agreement with Russia that will take over from the current Partnership and Co-operation Agreement, negotiated in the early 1990s. These new negotiations offer the best opportunity of engaging constructively with Russia over a wide range of policy areas, with a view to promoting the EU’s interests and values, and indeed our many common interests.

Let me touch on four areas of our relationship: the EU’s values; the energy relationship; regulatory convergence and human capital; and last but not least foreign policy.

• 1) 

  The EU’s values

In promoting the EU’s fundamental values Mr Medvedev’s emphasis on the rule of law may help. The development of a properly functioning independent judiciary will be particularly important to developing a true state of law.

On the other hand, the Duma and Presidential elections have shown that our views on what constitutes democracy do not entirely converge. It is therefore not always easy to speak about “common values”.

What we do share, however, are international legal commitments to a number of principles and instruments in the area of human rights and democracy: at the United Nations, and particularly in the OSCE, and the Council of Europe. We should lose no opportunity to remind Russia of the need to respect the commitments she has entered into – but in a constructive tone, without "megaphone diplomacy". I think we need a more realistic approach to Russia that is based on facts.

Human rights are already part and parcel of our discussions on expanding our co-operation in the area of freedom, security, and justice. Good progress has been made here, in particular regarding the Visa Facilitation Agreement (by the way, the first of its kind agreed by the EU) and the readmission agreement that came into force in parallel. There are other areas where progress has been solid: in expanding co-operation in civil and criminal justice, in the fight against illegal immigration, and in tackling drugs and human trafficking.

As we co-operate to improve the security of our citizens, and to crack down on crime, we must ensure that this co-operation fully respects civil liberties and human rights. Our human rights consultations, which happen twice a year, have developed into a useful confidence-building measure. In these consultations, there are no taboos, despite the sensitivity of the topic - a sensitivity which is by the way not limited to Russia. This is a two-way street: Russia also raises many concerns with the EU, notably with regard to the Russian-speaking minorities in the Baltic States.

• 2) 

  Energy

Energy continues to dominate the economic aspects of our relationship. True: A bit less than 40% of the EU’s gas imports depend on one monopoly alone: Gazprom. But vice versa, over 60% of Russian oil and gas exports flow to the EU. Russia's pipelines are largely directed towards the West. The Russian oil and gas sector badly needs more investment all the way along the production chain, and international investors are keen to invest, in spite of the well-known difficulties of operating on the Russian market. And finally, Russian companies are keen to expand their presence on the European market.

Therefore, there is great interest on both sides in negotiating arrangements that allow for an expansion of a Russian and EU-presence in each other’s markets. This should be done inside the New Agreement, of which energy policy will be an important part. Today, the EU market is more open than Russia’s, and in the interest of increasing leverage, it is important that we continue to move forward on the internal energy market, and speak with one voice on the external aspects of energy policy.

Our interdependence allows for a win-win situation to be created; with improved access possibilities upstream in Russia and downstream in the EU. Transparency, reciprocity and non-discrimination (both for production, trade and transit of energy products) are the key elements we need to secure to conclude a legally binding agreement that will lead to a level playing field in this sector.

• 3) 

  Regulatory Convergence and Human Capital

Beyond the energy sector, the negotiations on the New Agreement will continue to build on the advances that have been made over the past few years towards regulatory convergence. This will be particularly relevant after Russia completes its WTO accession process. After that takes place, we will be able to begin negotiations on a deep and comprehensive Free Trade Area as an integral part of the New Agreement.

High energy prices have contributed to a slowing of reforms in Russia, and protectionist voices inside Russia counsel against pursuing WTO accession. Yet it is in Russia’s long-term interest to pursue its integration into the global economy. In fact, Russia’s leaders know they need us, that it is the EU which will be Russia’s main partner in modernizing the Russian economy and diversifying it away from its current over-dependence on hydrocarbons.

Investment in human capital, in the social and education sectors, will be an important element of Russia’s economic reforms. Vladimir Putin’s approval last year of a law introducing key elements of the Bologna Process into the Russian education system – a rather unknown fact - is a positive sign, and the EU will continue to fund exchange programmes for both students and academics.

Russia also needs to mobilize its potential for innovation. There will therefore be scope for pursuing co-operation in Research and Development, notably through Russia’s possible association to the EU’s Seventh Framework Programme.

Investment in human capital also means addressing health and social issues. Russian demographic and health indicators are, frankly, worrying. A study by one of Russia’s leading demographers recently highlighted forecasts of a continuing slide in average life expectancy among Russian men (from an average of 59 now to possibly just over 50 over the next 40 years). Cases of HIV/AIDS and TB are also on the rise, putting further strains on the Russian healthcare system, and also having an impact on the Russian economy and Russian security more broadly.

• 4) 

  Foreign Policy

Foreign policy was a major factor in both the Duma and Presidential election campaigns. Russia’s more robust stance on international issues has gone down well with the Russian public, and there is likely to be a strong element of continuity under the Medvedev Presidency, in substance if not in tone. Much of the foreign policy discourse coming out of Russia has had a strong element of grandstanding to a domestic constituency, and it has proved more difficult for us to find concrete ways to co-operate on the resolution of conflicts around the world and specifically in our common neighbourhood.

The EU’s primary goal will be to advance the case that greater stability is in Russia’s best interests. This applies to our common neighbourhood, seen by some in Russia as its "sphere of influence", and where it is important to maintain our commitment to promoting the rule of law, human rights and democracy; to the Balkans; or farther afield. The EU will also be arguing strongly in favour of multilateral engagement in international issues. These elements will be present whether we are discussing Kosovo, the frozen conflicts in our neighbourhood, the Middle East, or other international flashpoints.

The Russian moratorium on participation in the CFE, its hard line at the UN over Kosovo and the unilateral withdrawal from the CIS-ban on trade links with Abkhazia are all evidence of a trend towards greater unilateralism in Russian foreign and security policy. This is a challenge to which must find a response.

Ladies and Gentlemen,

There is of course, another dimension to all this: That is the stance the EU itself adopts towards Russia.

The EU and Russia are not always evenly matched: Take our energy relationship, where Russia has been extremely effective in pursuing its interests coherently and strategically. Can the same be said of the EU?

We all know the EU needs to speak with one voice and that where has done so it has been infinitely more effective in pursuing its interests. The united EU stance at the 2007 Samara Summit took Russia somewhat by surprise, and the development of a more coherent EU line towards Russia can only help put the relationship on a more even keel.

The arrival of a new Russian President is an opportunity for the EU to address these imbalances. We need to adjust the tone of our discourse to better reflect the reality of two economic powerhouses cooperating as equals.

We must treat Russia with respect, as the strong economic power it is today. Yet we must also be more confident about identifying and coherently pursuing our own European interests. And we must be more confident in using our considerable economic leverage and attraction for Russia as she seeks to implement her modernization agenda.

That confidence should also extend to the past. History has shaped and will continue to shape the way in which we view each other. But the actions of the past should not be used as an obstacle to the development of our future relations.

Dear friends,

Geographic realities, the great expansion in trade and business opportunities, shared histories, and cultures that have mirrored and borrowed from each other down the centuries mean that Russia and the European Union will always be close, and that we will remain strategic partners.

This is not to say that we can always see eye-to-eye on everything. It would be odd if we did. Russia has seen dramatic changes since the events of 1991. The Russia of today is scarcely recognizable from the days of the Soviet Union. The rapid transition of the 1990s has given way to greater stability that is much appreciated by Russian society, for many of whom the Putin years brought rises in personal incomes and a greater belief in a brighter future.

But greater economic freedom has somewhat come at the expense of the greater political freedom that Russian citizens enjoyed in the 1990s. So when we talk to Russia, we should be sure to talk to Russia as it is, rather than with Russia as we would like it to be.