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Russia vs. the West

Political Stability | Economic Overview | Business and Regulatory Environment |


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Russia considers the tussle to bring Ukraine back under its wing wrapped up for the most part. It isn’t looking to reintegrate Ukraine back into Russia as it did during the Russian imperial or Soviet days, but it does want to ensure that it can influence Ukraine’s orientation and prevent Western influence from permeating this strategically important buffer.

 

The West hasn’t given up, however. Although the United States is currently preoccupied in the Middle East and South Asia, quite a few influential European states, especially Poland, Romania and Sweden, are still intent on Westernizing Ukraine. Europe knows that as long as Moscow has a strong influence in Kiev, Ukraine will never really be up for EU accession. Moreover, many EU states do not want Ukraine as an EU member for three basic reasons: They fear the European Union is already too unwieldy; they have an aversion to including such a poor and chaotic country; and they want to avoid irritating Russia.

 

Instead, the Eastern Partnership (EP) project launched in 2008 has been the consolation for those looking to Westernize Ukraine. The EP initiative, which has been slow to get off the ground, is a kind of “friends of the EU” program for FSU states. Under the EP, Europe is hoping to liberalize visas and boost economic investment and aid. No matter which government is in power in Kiev, it welcomes the EP for the economic benefits it brings. Moscow has not been too concerned about the EP because it is such a loose alliance and many EU states are not very enthusiastic about it. However, should the EP start to really transition into an alliance with political influence, or as a superhighway to EU accession, Moscow will be quick to crush Ukraine’s involvement in the nascent organization. It is unlikely that the EP will reach that stage in the next decade or so.

 

Though Moscow is looking mainly to exert influence over Ukraine, there are many inside Russia who want some sort of economic integration. Discussions are under way to determine if Ukraine should join Russia’s new customs union, which has already integrated the economies of Belarus and Kazakhstan with Russia’s. But the discussions thus far have been merely rhetoric. Should Ukraine actually join, it could crush some of the country’s most important economic sectors under the new regulations. At this point, Ukraine does not appear to be on the path toward joining the customs union, although speculation about its integration will continue to be widely reported.


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