Europe

For the past six years, Louise Richardson has served as the Principal and Vice-Chancellor at St. Andrews University. Richardson is an expert in international terrorism. 

To learn more about the appointment, click here. 

To read Louise Richardson's complete biography, click here.

Click here to watch the video on RT

Economic and political turmoil in Ukraine has led to a significant reduction in energy consumption which should have eased the country’s key economic burden—its heavy dependence on dollar-priced hydrocarbon imports. In 2014 natural gas consumption alone went down by 16 % to 42.6 bcm, and imports fell by 8.3 bcm to 19.5 bcm. Falling demand and cheap crude also decreased Ukraine’s natural gas bill which went down from $12 billion in 2013 to $8.8 billion in 2014.

The country nevertheless continues to depend on energy imports—the energy import bill is indeed one of the most important internal economic and political challenges Ukraine faces. Almost all the proposed solutions have one common point: diversification and a shift away from dependence on Gazprom. However, these policy ideas still lack a realistic implementation plan and sound cost-benefit analysis: a fixation on import diversification has led to the neglect of domestic energy resources and a failure to promote energy saving.

So what is the solution?

Fixing Naftogaz’s deficit and improving the governance of this national champion must be the main priority of Ukraine's energy policy. The decrease of energy imports should have reduced the deficit of the national energy company Naftogaz. In reality, the deficit went up from $2 billion in 2013 to at least $7-$8 in 2014. Though non-payments and national currency devaluation have contributed to Naftogaz’s shortfall – they cannot explain the fourfold increase in the company’s deficit. Residential gas prices went up 50 % as of May 2014, industrial consumers continued to pay market-based tariffs, higher than the average price of imported gas - all this should have helped to alleviate Naftogaz’s deficit. Furthermore Naftogaz produces enough cheap gas to cover over 90% of Ukraine’s residential/heating demand. According to various media reports part of the deficit was linked to the mismanagement of production and gas flows. For example, in December 2014, Ukrainian national weekly ZN.UA published summary conclusions of the Audit Chamber of Ukraine. The report claimed that in 2011-14 period around 2 billion cubic meters per annum (bcma) produced by Ukrnafta—an upstream subsidiary of Naftogaz—were sold to private entities at the highly discounted price of $15 - $26/mcm, representing only a fraction of Ukraine’s industrial tariffs. Naftogaz was forced to source these volumes abroad paying in average $700 million per year. It is estimated that at least 3 bcm of gas produced by Naftogaz and its’ subsidiaries do not reach intended customers in residential/heating sector. Putting the house in order is therefore a clear “must”. Introduction of transparent governance is in the case is the only solution able to boost Naftogaz’s financial results and decrease its deficit.

Improvement of energy efficiency is also extremely important for Ukraine, which is in dire need of affordable energy supplies to re-launch its economic and industrial growth. According to the World Energy Council, the energy consumption of Ukraine's GDP reached 0.47 million British thermal units last year, almost four times higher than the average within the Organization for Economic Cooperation and Development. While some policy measures were implemented by the previous governments, introduction of energy-saving and energy-efficiency measures had been effectively blocked by lobbies of domestic energy intensive industries. In the last five years, the energy intensity of Ukraine's economy decreased only by 3.5 percent—a meager result even if compared with rather modest progress made even by its’ eastern neighbors. Energy saving is a low hanging fruit in Ukraine—it is cheap and will bring immediate results. Ukraine's energy-saving potential could reach as much as 40 - 50 percent of its current energy consumption.

Ukraine’s 'independents' is an important source of natural gas which should not be underestimated. In June-November 2014 period, Ukraine’s gas production rose by 2.1% year on year to 18.1 Bcm. This was mostly due to the performance of independent companies, whose output rose by 26.7% to 2.67 Bcm; conversely, Naftogaz’ production fell by 1% to 15.43 bcm. Independents’ output could reach 5.7 bcm by 2017 under a favorable investment-friendly tax regime.

Ukrainian government chose a different path, sharply increasing gas taxation for private producers in December 2014. The new fiscal regime clearly favours the license–holder of the large fields (e.g. Naftogaz) over smaller private enterprises and risks to undermine both the growth of independents and liberalization of Ukraine’s gas market.

These examples show that the energy reform in Ukraine stalls due to the lack of real reforms and some of the government’s actions even against the spirit of the Energy Community and liberalized energy market. While the Ukrainian leadership took some steps which shows its commitment to reforms—e.g. adoption of Third Energy Package compliant gas market law (Law N. 2250), thus breaking Naftogaz’s monopoly—Kiev has still a long way to go. However these steps should be coherent with a general fiscal and energy policy. New laws should also be working in practice and not only on paper. Increasing transparency, strengthening institutions and reducing the complexity of the legal system should be given high priority. It is up to Kiev to fully play by the European rules and not just applying them selectively.

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To read the article at the European Energy Review, click here.

LEBRING-SANKT MARGARETHEN, Austria — In my life I have participated in several military parades, but one stands out. As an officer candidate in the Austrian Army, I marched in step to the tune of the “Radetzky March” past a crowd—my Uncle Winfried and Aunt Waltraud among them—down an alley leading to Eggenberg Palace, in Graz.

It was late fall, chilly and dark. Half the members of my company carried torches, which cast eerie shadows on the Baroque exterior of the castle.

As we marched by, crowds spontaneously clapped, some shouting, “Bravo, super Burschen!” (Well done, fine boys!) The shrill bark of red-faced sergeants and long days of monotonous drill were for a brief moment forgotten. Not forgotten were the echoes of past parades and the fate of those who had marched and cheered.

Grand national military parades are waning in most of the West, but in Asia, they are becoming a popular form of statesmanship. This year, lavish pageants of military hardware and marchers in formation will advance down boulevards in India, Pakistan, North Korea and China, as well as in Russia, straddling Europe and Asia.

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Yet however alluring and visually striking, these parades embody militarism, the deadly business at the heart of almost all sovereign states. The term “parade” comes from the Latin word “parare,” to prepare. Throughout history, parades have helped prepare citizens for war.

This volume of military parades suggests a dangerously combustible combination of militarism and national insecurity. They often create instability by starting a self-perpetuating cycle of lethal competition.

The 2015 Asian parade of parades began in January in India, which held a Republic Day gala in New Delhi. It featured cultural and religious tableaus woven into an awesome array of military displays. The “chief guest,” Barack Obama—the first American president to attend the event, with the first lady, Michelle Obama—applauded the troops with Prime Minister Narendra Modi and a host of dignitaries.

But these martial displays can prompt other nations—especially on borders—to continue a parade arms race in order to dispel notions of vulnerability and strengthen deterrence.

Following India’s parade, after a seven-year hiatus, Pakistan plans to hold its own Republic Day military parade. Noting President Obama’s visit to India and perhaps a Western tilt toward that country after NATO’s exit from Afghanistan, Pakistan’s prime minister, Nawaz Sharif, was hoping to secure President Xi Jinping of China as his “chief guest” of this year’s ceremony, as both leaders posture for a strategic alliance.

National military parades invite their own bigger and better sequels. Yet leaders of these countries might recall Europe’s experience in the late 19th and early 20th centuries, when countries underwent military innovation and stockpiled arms before the world wars.

Europe’s influence on parades can be found in Asia today in marching techniques, which often feature variations of the Prussian goose step (Stechschritt), especially popular in China, Russia and North Korea. Of the goose step, George Orwell noted that it is “one of the most horrible sights in the world.” He added, “It is simply an affirmation of naked power; contained in it, quite consciously and intentionally, is the vision of a boot crashing down on a face.”

Russia needs no reminder of the awful toll of the goose step. A parade will fill Red Square in May to commemorate the 70th anniversary of the end of World War II, the country’s most destructive war. President Vladimir V. Putin has expanded Victory Day celebrations, feeding his citizens’ reactionary sentiment for Soviet-era military prestige.

Military parades can also publicize military spending. In countries like China, where only a figure for the total defense budget is released, they help show what taxpayer money is buying.

After staging only three military spectacles since 1960, the Communist Party of China aims to “make Japan tremble,” according to The People’s Daily, a state-run newspaper, with a prodigious military parade later this year.

President Xi will reportedly, in an unusual gesture in China’s modern history, invite foreign heads of state to witness this tour de force in Beijing. Leaders of Taiwan, Vietnam and the Philippines may tremble as well.

In Japan, Prime Minister Shinzo Abe has sought to ease postwar constitutional restrictions on the country’s military. Under the aegis of “Abenomics,” the Diet has approved an increase in military spending for three consecutive years.

No one who has ever participated in a military parade can deny the rousing yet mind-numbing sensation that marching in perfect synchronization to the tune of martial music invokes, as well as the peculiar intoxicating bond that is forged between the soldier and the audience.

Marching, you are not allowed to move your head—save the dramatic “eyes right” for the presiding leader—and should restrict your vision to the neck seam of the soldier in front.

This peripheral blindness, however, affects the soldiers, yet also the onlookers, creating what Harold Rosenberg called “a herd of independent minds.”

There is another, more solemn version of the military parade. In June 2012, I stood in a long line of a few hundred American soldiers and contractors flanking left and right the main road of Forward Operating Base Salerno in Khost Province, Afghanistan. A coffin draped with an American flag was slowly carried through the base.

There was no music and no marching in step. A chaplain and a few soldiers of the unit escorted the coffin to a C-130 transport plane waiting on the runway. A loudspeaker shouted out the commands, and even though I was wearing civilian clothes, I instantly assumed a military posture at the order of “Attention!” With no further thought, I also knelt down at the command, “Prepare for prayer!”

When I later wrote about my experience in a story for an Austrian newspaper, many complained that I—as a correspondent—should not have participated in this “hero ceremony.” I felt I almost had no choice.

For a soldier, parades mark the beginning and sometimes the end of military life. For nations, throughout history—and this is what Asia’s leaders should keep in mind—what begins as a parade often ends in carnage and death.

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To read the piece at The New York Times, click here.

Creighton emphasized that a comprehensive strategy is required to combat the terrorist group, and maintained that the U.S. must take a leadership role in the fight.

To watch the video on the Arise News Youtube Channel, click here.

This essay was originally published in "Internationale Politik," and an English translation was published by the Munich Security Conference

Western leaders are more than willing to point out that there can be no military solution to the crisis in Ukraine. This is true – albeit only from their own perspective. Moscow has successfully used military force, one outcome of which is that the vision of a Euro-Atlantic security community has suffered significant injury. The current European security system could not prevent either the annexation of Crimea or the destabilization of Eastern Ukraine. And despite the ceasefire agreed in Minsk in September 2014, people are still dying through acts of war in the country that hosted the 2012 UEFA European Football Championship. In violation of the Euro-Atlantic acquis of Helsinki, which states that borders may only be changed by peaceful means, Russia has used military force both openly and covertly.

Today it is not only Ukraine that feels under threat but also other countries such as Moldova, Georgia, and the Baltic States. It is not impossible to imagine that a gray area might emerge between the EU/NATO and Russia. From Moscow’s standpoint, these countries form a cordon sanitaire, even though we always wanted to avoid differing levels of security across Europe. So far NATO and the EU have demonstrated a considerable degree of solidarity, and have responded with economic sanctions alongside a program of military reassurance within NATO. But the unity of the West is likely to be tested still further even if the ceasefire agreement were to work.

The question of Crimea must not be swept under the table. However, since it cannot be resolved under the current circumstances it is important to consider it separately as its own issue – a similar approach to the one adopted by Egon Bahr to bring the gridlocked negotiations between the two German states to a successful conclusion in 1972.

The current crisis does not represent a short-term worsening of conditions, rather we are watching a fundamental shift of East-West relations unfolding before our eyes. The situation is unlikely to change any time soon.

Russia’s zero-sum logic

As Russia sees it, the EU wanted to bring Ukraine closer to Europe and convince it to sever ties with Russia. But it is simply not correct that Kiev was forced to choose between the EU and Russia. What is true is that the EU was not prepared to accept Russia’s “droit de regard” in the negotiations with Kiev regarding an association agreement. Who are we to demand that Kiev accept that a third party will have a say in negotiations about the future direction of the Ukraine? The EU acted appropriately when it made sure not to give the impression that Moscow was being allowed to decide on the future of Ukraine.

Chancellor Angela Merkel underlined this point in the Bundestag at the end of November, quoting her own speech from the previous year: "The EU has repeatedly offered to speak with Russia to work out the mutual benefits of cooperation. It is my deep conviction that we must continue with these efforts to ensure that there is no either-or for countries in the eastern partnership between moving closer to the EU and Russian efforts to establish a closer partnership with these countries." Even if the association agreement had led to challenges for Russia’s trade relations with Ukraine, the Chancellor emphasized, it could not serve as either a legitimization of the annexing of Crimea or as justification for Russia’s involvement in the fighting around Donetsk and Luhansk.

Moreover, Russia's opposition to the EU is a relatively recent phenomenon. President Putin declared at a 2004 press conference: "If Ukraine wants to join the EU and if the EU accepts Ukraine as a member, Russia, I think, would welcome this because we have a special relationship with Ukraine." Ten years later, Russia is not even willing to accept an association agreement between the EU and Ukraine.

Which of Russia's complaints deserve serious consideration? The most significant is the suggestion that the West has built a common European home, but without giving Russia its own room, as American historian Mary-Elise Sarotte phrases it, utilizing a metaphor previously employed by Mikhail Gorbachev. During debates surrounding NATO expansion in the 1990s, the German government insisted on a two-pillar strategy: Yes to NATO expansion, accompanied by a more intensive partnership with Russia. Helmut Kohl insisted that the two aspects needed to be balanced and complement each other. Without NATO expansion, the countries in Central and Eastern Europe would have continued to feel unsafe. And yet without a strong NATO-Russia partnership, Russia would be locked out of the "common home." The outcome was the development and implementation of a dual strategy.

Regrettably this dual strategy was later abandoned, under the George W. Bush administration. His government chose to discontinue the Gore-Chernomyrdin Commission that had been such a key bilateral channel under Bill Clinton. More importantly, the Bush administration withdrew from the ABM treaty (an area where the Russians are particularly sensitive because it is the only issue where Russia is still on an equal footing with the United States) and began to plan for a missile defense shield.

The Bush pursue of NATO expansion and supported Kiev and Tiflis in their efforts to obtain membership, even though there was no consensus on the issue in either Ukraine or Georgia. At the 2008 NATO summit in Bucharest, France and Germany rejected the US proposal to extend the Membership Action Plan to Ukraine and Georgia. Tensions between Russia and Georgia escalated a short time later, with Russian troops occupying a number of Georgian territories. From Russia's perspective the West had continued to ignore Russia’s security interests; only a clear message would put a stop to that.

This sentiment is widely felt throughout Russia. In the summer of the Russia-Georgia war in 2008, Mikhail Gorbachev wrote in the New York Times: "Indeed, Russia has long been told to simply accept the facts. Here’s the independence of Kosovo for you. Here’s the abrogation of the Antiballistic Missile Treaty, and the American decision to place missile defenses in neighboring countries. Here’s the unending expansion of NATO. All of these moves have been set against the backdrop of sweet talk about partnership. Why would anyone put up with such a charade?" Given the widespread belief that the West has steadily exploited Russia’s weakness after the fall of the Soviet Union, Putin's policy of restoring Russia’s status as a world power is exceedingly popular. If the West has made one error it is that of abandoning the original NATO dual strategy.

Domestic policy game-changer

How do you deal with a country that views itself as a victim? None of the above should be taken as an excuse for Russia's use of force or the revisionism that shapes Putin's current foreign policy. But if we want to deal productively with Moscow then we need to understand the perceptions and emotions that form the backdrop to Russia's actions. This sense of being unfairly treated by the West makes it extremely difficult to rebuild a constructive relationship with Moscow.

Today the problem is that Russia is a superpower only in the military sense (above all due to its arsenal of nuclear weapons) and in terms of its energy resources. In the 21st century, superpower status does not just depend on military capabilities but also on the ability to persuade and acquire partners, to get involved and get others involved to shape alliances. According to this definition the Russia of today is definitely no superpower.

When Barack Obama was elected, his administration decided to rebuild the country's relationship with Russia from the ground up. Obama reworked the missile defense plans, turned them into a NATO project, and invited Russia to collaborate. This strategy produced positive results, including a new START agreement and greater cooperation in relation to Afghanistan and Iraq. Nevertheless, both sides remained dubious about the other’s intentions. Instead of becoming a game-changer and serving as the roof of the "common home," the missile defense system emerged as a form of "game-breaker."

What also changed, however, was Russia itself, as observed by Michael McFaul, former US ambassador to Moscow: "Russian foreign policy did not grow more aggressive in response to U.S. policies; it changed as a result of Russian internal political dynamics. The shift began when Putin and his regime came under attack for the first time ever." Many observers assume that the demonstrations occurring before Putin was reelected president gave him the impression that someone was trying to bring about regime change. That is why he is so determined to prevent any further color revolutions. Strobe Talbott wrote an essay in 2014 describing it like this: "Putin's aggression only makes sense against the backdrop of what has been the defining theme of his presidency: turning back the clock. For years that has meant repudiating the transformational policies of his immediate predecessors and reinstating key attributes of the Soviet system within the borders of the Russian Federation."

A new dual strategy

How should the West respond to Putin’s revisionism? What might a strategy look like that would neither discard the fundamental norms shared by large parts of the Euro-Atlantic area nor add fuel to the fire? I propose a new dual strategy:

We need strategic patience, and we must attempt to negotiate from a position of strength, not one of weakness and indecisiveness. In his first speech on assuming office, the new Secretary General of NATO Jens Stoltenberg stressed that better ties with Russia are more likely to be achieved if the alliance is strong. It is vitally important to constantly reiterate our obligation to provide mutual assistance, as outlined in Article V, as well as the indivisibility of security among NATO members. However, we should also avoid getting caught up in new discussions about Ukraine's NATO membership. There is a simple three-step test to measure whether a country should be invited to become a member or not: Is there consensus within the respective country regarding the application for NATO membership? Do all NATO alliance partners agree to invite the country? Would this NATO membership enhance European security or not? Only if the answer to all three questions is affirmative should the country in question actually be invited to become a member. Today and tomorrow, Ukraine would not pass this test.

We also need to expand on the second pillar in the dual strategy. There is a real risk that an overreaction on the part of the West could lead to Russia retreating behind a barricade of patriotism. There has been heightened rhetoric recently even among liberal Russian politicians and commentators. Our goal cannot be to play the role of the enemy against whom all Russians must unite. Sadly, Russians today rarely hear the voice of dissent. Russian media has, for example, created the Fata Morgana of Ukrainian fascism despite the fact that the main right-wing parties only received around two per cent of votes. By contrast, the Russian government invited envoys from European neo-Nazi parties to serve as election observers. When the conflicting parties so obviously live in different worlds it becomes difficult to find a solution. But we should try to make clear that it is not the West that is attempting to avoid a collaborative relationship.

In my opinion, we should launch a diplomatic process under the umbrella of the OSCE. This would bring Russia back to the table and allow us to consider new ways of approaching the idea of a common European home or comprehensive Euro-Atlantic security community. This is of course a long-term goal but it is important to keep the idea active.

One shorter-term goal could be to improve military transparency. The past few months have seen a series of close calls between Russian combat aircraft and planes from the West. Neither Russia nor NATO have any interest in an accidental escalation with potentially far-reaching consequences. Even at the peak of the Cold War, both sides endeavored to mitigate the risk of misunderstandings and to avoid this route to a possible nuclear war.

The Nuclear Threat Initiative recently published its report "Building Mutual Security," containing several important proposals. Key questions include: Why are intercontinental ballistic missiles still kept on high alert? Why can longer advance warning periods not be agreed upon? And in a similar vein, would it not be possible to create more transparency on military exercises? The size of Russian exercises held in the last few years has frequently been kept barely under the threshold that would require NATO observers to be present. Finally, negotiations on conventional arms control could be ramped up again to improve security and reinforce mutual trust.

Recent developments, unfortunately, are not heading in this direction. For example, Russia has ended its cooperative work with the US to secure nuclear material on Russian soil. This program will now end in 2015. On the other hand, Russia’s involvement in the Iranian nuclear issue points to the possibility of increasing Western-Russian cooperation in areas where common interests prevail. We could also offer Russia an economic partnership. Chancellor Merkel recently talked about the possibility of establishing a common economic area including Russia. As a first step the EU could work with the Eurasian Economic Union (EEU). This new dual strategy centers on the idea of "congagement" – a blend of containment and engagement which was recently also proposed by the Peace Research Institute Frankfurt.

A Russian Federation that abides by the rules

How should we proceed with sanctions? Sanctions are not an end in themselves. Their purpose is to give Russia incentives to cooperate in efforts to stabilize Ukraine. It is not about punishing Moscow or making the Russian people suffer. Destabilizing Russia is not an option. All of us want and need a stable and prosperous Russian Federation. But we also want a Russian Federation that abides by the rules and works with us to strengthen the architecture, institutions, and rules of European security.

In the early 1970s, hardly anyone believed that it was a good idea to start the negotiations that eventually led to the Helsinki Accords. In the 1980s hardly anyone could imagine that most of the central and eastern European states would soon become democracies. Today, hardly anyone might believe that it makes sense to restart negotiations with Russia.

To be clear: this task may take an entire generation. In the past few decades, sadly, our societies, in Germany in particular, have taken peace and security in Europe very much for granted. If the events of 2014 – in Ukraine and elsewhere – bear any message for us it is this: how can we establish an effective and legitimate global and regional system of governance in times when demand for it is high and supply low. And how we can hang on to the fading dream of European security rather than let it descend into a long nightmare.

At the European Gas Conference 2015 late January, EWI Fellow Danila Bochkarev discussed the future of liquefied natural gas (LNG) in Europe. At the conference, which took place in Vienna, Austria, Bochkarev sat on a panel that sought to answer where LNG in Europe may come from. Bochkarev expressed skepticism that Russia would be the source for European LNG. "Not only is Russia a latecomer, it is mostly focused on Asia,” he said.

"The question remains whether...LNG would really go to Europe," Bochkarev said. 

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To read more of Bochkarev's thoughts on the future of LNG, click here.