The European Union-Ukraine summit on Dec. 19 in Kyiv was rightly low key. Expectations had been steadily downgraded.
Signing the agreements was out of reach by the time of ex-Prime Minister Yulia Tymoshenko’s guilty verdict on Oct. 11. Initialing the agreements briefly seemed possible, but that hope was destroyed by Kyiv’s failure to deliver on hints of compromise.
All that was left was the announcement that negotiations on the association agreement have been finalized, and that “the way is now open for technical completion of the final consolidated version of the agreement, including its deep and comprehensive free-trade area, with a view to its initialing as soon as possible.”
Blah, blah. Meaning, that the process is still alive, but only just.
By EU standards, the line coming out of Brussels was relatively firm, for several reasons.
First, because of the egregious nature of the Tymoshenko trial: not the inexperienced judge or the often farcical proceedings, but the damming failure to produce actual evidence of any criminal behavior that led to a seven-year prison sentence against her. The other charges that were laid after the conviction only confirmed this impression of the trial itself.
Second, the trial served to concentrate minds about so many other things going wrong in Ukraine. There was an element of guilt here, as the EU had turned a blind eye to too much in 2010.
Third, individual EU leaders invested a lot of personal capital in negotiating with Ukrainians and felt let down.
Fourth, President Viktor Yanukovych’s regime really doesn’t understand how the West works. It tried to bluff and blackmail its way out of trouble, and the impression that it was trading over a legal verdict again only confirmed the impression of utter cynicism.
Nevertheless, there were roughly three schools of thought in the EU, even after the Tymoshenko verdict. One group was happy to use the trial to keep Ukraine where they had always wanted it – at arm’s length. The opposite group of Ukraine’s traditional friends was, however, also divided.
Some of those who recognized Ukraine’s longstanding difficulty in transforming itself in the absence of any realistic EU membership perspective argued that the association agreement would provide a near equivalent.
Although Ukraine’s commitment to implementation was not clear, the gradual adoption of EU standards in business, government and bureaucracy, it was hoped, would slowly transform the country, undercutting the power base of Ukraine’s corrupt business monopolies. The need to keep this prospect alive motivated the European Parliament to take a soft line in its resolution of Oct. 25.
Also, the EU announced on Dec. 5 that it would begin free-trade negotiations with Georgia and Moldova in the New Year – if the process with Ukraine collapsed these could be left in limbo, too.
The opposite argument was that a red line had been drawn in the deepest crimson. The EU would lose all credibility if it went ahead and signed the agreements after all. It would also undermine the principle of conditionality (more for more, less for less) that was the key to the relaunch of the Eastern Partnership in September.
It would also make it extremely difficult to deal with Russia once Vladimir Putin returned as president. If the agreements collapsed, the argument went, so be it. Ukraine has shown it is not ready.
The EU can and should combine both approaches. The EU agreements should be kept alive, but Ukraine could hardly be rewarded for its recent behavior.
Brussels should therefore initiate a twin-track policy of “sign and sanction.” Not actually signing the agreements, but keeping them going through 2012, while simultaneously introducing some symbolic sanctions.
This is only a superficial paradox. It may not be natural for the EU, but it reflects a similar policy already adopted on Belarus and may also be where Brussels is heading on Russia.
Precisely because the rot now goes much deeper than the Tymoshenko trial in Ukraine, this should also be the basis of Western policy towards Ukraine. The summit was a start in this direction. At least Yanukovych turned up to suffer a formal dressing down. But lecturing the Ukrainians is not enough.
Yanukovych’s Ukraine will not change unless it has incentives to do so. Travel restrictions on key officials involved in the Tymoshenko trial and a closer eye on financial transactions in EU states like Austria and Cyprus would work wonders.
Moreover, Ukraine’s calculation of interests is likely to change in 2012. The current hubris over near 5 percent gross domestic product growth for 2011 masks the reality that Ukraine has done little to build up its economic defenses. Debt is high, the banking sector is weak, most foreign banks have de-capitalized, and there is hardly any foreign direct investment.
Ukraine cannot survive economically on its own. Ukraine is not Turkey – a strong and independent player on the edge of Europe, increasingly able to set its own terms. And the alternative to Ukraine’s agreements with the EU is not a turn to Russia, which is just blackmail and bluff, but an isolated and poor Ukraine that is highly vulnerable to double-dip recession.
Yes, Ukraine suffered in 2009, but it didn’t take the harsh medicine of structural reform that leaves states like Latvia and Estonia better positioned to survive any renewed slowdown. Ukraine will need the International Monetary Fund soon enough, possibly as soon as the second half of 2012 – when the time will be ripe to look at the EU agreements once again.
Andrew Wilson is a senior fellow at the European Center for Foreign Relations who has written extensively about Ukraine and the region. His latest report, “Ukraine After The Tymoshenko Verdict” is available at www.ecfr.eu.
Part 1. Was summit successful?: Ukraine took big leap with EU on Dec. 19
