BY
It would be foolish to state a last role of the
trade agreement dice occurs on 9th and 10th November in Brussels when the
Kremlin will probably once again try and convince the European Union and
Ukraine to delay the 1st January 2016 DCFTA coming fully into force. That
opportunity to role the dice continues until 1st January 2016 – and possibly
beyond – perhaps with seemingly completely unrelated dice (especially if The
Kremlin believes its dice are loaded).
The two day meeting in Brussels next week takes
the form of trade experts, meaning no major announcements of policy changes or
implementation delay – for major announcements are always reserved for senior
politicians. Heaven forbid experts and mere functionaries make major
announcements!
As such, any confirmation of implementation on
1st January (for those who need reassuring), or the highly unlikely
announcement of a further suspension, will come when European Commissioner for
Trade Cecilia Malmstrom visits Ukraine on 12th and 13th November – two days
after the meeting of trade experts.
Every man and his dog has long predicted that
when the agreement with the EU enters into full force on 1st January 2016, The
Kremlin will introduce a more or less complete trade embargo upon Ukrainian
goods – a perverse, in some cases self-harming form of reciprocity perhaps, the
act of a spurned lover maybe, the misguided notion of a nation that wants
unconditional love and respect based upon its own terms, rather than affording
those same sensibilities and terms to those around it.
A large scale trade embargo toward Ukraine is
all but assured by a Kremlin that perhaps still believes it can beat, threaten
and coerce the current Ukrainian direction out of it – when instead with every
such act, it simply beats that choice further in.
The question therefore, is how long will any
such Kremlin instigated embargo upon Ukrainian goods last? The answer will be in years – but how many?
A glance at the 1990’s would suggest that as a
petulant and truculent Kremlin embargoed almost all trade with the eastern
European and Baltic States as they swiftly stepped out from under The Kremlin
shadow, they rapidly redirected their trade flows. Naturally a free trade
agreement with the EU, let alone the deep and comprehensive one that comes into
force, means that Ukraine will have little option but to make the most of that
opportunity (and other opportunities outside of Europe). Those certain Ukrainian
businessmen that pre-war in The Donbas who would have tried to slow such a
process due to their trade interests with Russia, having seen them dramatically
effected by Kremlin sponsored events in the east, will also be forced to look
to other markets during the (likely) forthcoming embargo years.
During the early 2000’s, similar Kremlin
embargoes on Moldova and Georgia forced trade reorientation with Europe (and
others) too.
The end result being that when The Kremlin
relaxed and/or removed its imposed embargoes, pre-embargo trade levels never
returned – with any of the nations involved.
Considering the scale of Kremlin aggression
toward Ukraine, and The Rubicon being crossed for far too many Ukrainians in
this generation to return to a normalised relationship with The Kremlin,
neither Russia or Ukraine should be expecting a return to historical pre-war
trade levels for several decades from when soon to be implemented embargoes are
eventually lifted in the years ahead.
Some may opine that in fact, a Kremlin induced
embargo will force Ukraine to implement the DCFTA per the sequenced 10 year
implementation framework that it would otherwise undoubtedly have been somewhat
more glacial in completing.
It would seem highly likely that the WTO will be
engaged in refereeing Ukrainian-Russian trade spats for many years to come too.
Nevertheless, the Kremlin has a trump card – and
it is a trump card it doesn’t have to play, for it is a card that continually
plays itself. That trump card is the majority of the Ukrainian political
class. Its continued fecklessness and dysfunctionality is always worth a
side-bet when it comes to snatching defeat from the jaws of victory.
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