In their haste to secure a new East European dumping ground for the West’s surplus commodities, manipulate the European energy market, undermine Russia’s economy and impose upon an independent country a political leadership tied to an imperialist agenda, the EU and the IMF have unleashed a political storm in the Ukraine which they will come to regret.
Kiev reluctant to dance to the IMF’s tune
Ukraine’s surprise decision to hold back for the moment on signing up to what has been billed as a “historic” agreement to expand a free trade zone between the Ukraine and the EU has stunned the West, throwing all its calculations into disarray. What was supposed to be a crowning moment of imperialist diplomacy, with Kiev taking a decisive step down a slippery slope ending in complete subservience to the West, turned into a complete farce. November’s two-day “Eastern Partnership” summit in Vilnius, at which the “historic” deal was to be sealed under the approving gaze of the heads of state or governments of all 28 EU member states, instead ended not with a bang but a whimper, with no agreement signed.
For three years the EU has dangled the prospect of a bilateral trade agreement with the Ukraine as the supposed solution to the economic chaos precipitated by the so-called “Orange Revolution” of 2004, when the democratically elected Prime Minister Yanukovych was ousted and replaced by leaders better suited to the West. Subsequent elections have seen power seesaw between those who want to preserve the benefits deriving from a reciprocal economic relationship with Russia and those who would tear up this relationship on the strength of a dubious promise of EU jam tomorrow. As President Yanukovych puts it, “They’ve been teasing us with this candy in a bright wrapping for three years, telling us we would get it as soon as we sign the IMF deal. Don’t humiliate us. We are not kids; we don’t fall for sweets. We are a serious European country.”
So confident was the EU that the promise of a credit line from the IMF, resulting in a glittering 610 million euro aid package, would be enough to sell the deal to Kiev that they kept upping the ante, demanding ever more onerous restructuring terms as the price to be paid. The prime minister, Azarov, explained: “The last straw that broke the camel’s back was the IMF’s position. They offered to provide us with a loan equal to what we have to repay them. At the same time they demanded to double utility prices, freeze salaries, and cut budget spending.” In addition, as if deliberately to rub in the political subservience which comes as part of the package, the EU demanded the release from jail of a prominent figure in the “Orange Revolution” putsch, the disgraced Yulia Tymoshenko. Currently doing time for abuse of office, she is now clamouring to be allowed to go to Germany to fix a back problem, so that she can with greater comfort issue her shrill appeals ” to all Ukrainian people to resist and rise up against Yanukovych and his dictatorship.” (‘Yanukovych’s heinous crime is to have beaten Tymoshenko in the presidential elections of 2009’.)
Meanwhile the sober reality is that “Yanukovych and his dictatorship” have not slammed the door on future trade talks with the EU, simply putting Brussels on notice that negotiations cannot be pushed through under duress, riding roughshod over Ukraine’s independence. As Azarov puts it, “We’d like to discuss the provisions, which bother us. We’d like our initiative to be treated attentively and maybe we’ll be able to achieve compromise.” Yanukovych insisted that a public debate on the issue should be held “so that society can give its evaluation of what we want to achieve, on what terms and why we put the problem as it is… It must be made clear that we are protecting our interests.” The government in Kiev has also made it clear that this debate cannot ignore Ukraine’s existing economic relations with the East. Indeed, rather than walk away from the Vilnius talks, the president attended the talks as planned, hoping to promote three-way talks between the Ukraine, EU and Russia and insisting “We want to have good relations with both the EU and Russia.” He even ventured to suggest that if such talks were successful, an agreement along more equitable lines could be signed in the spring of 2014.
Whether such a commonsensical approach, endorsed by Russia, will cut any ice with the EU or the IMF may be doubted. Meanwhile Russia is steaming ahead with plans to extend its own customs union with Belarus and Kazakhstan into a Eurasian Economic Union which Kyrgyzstan and Armenia could also join.
The EU’s real target: Russia
Russia, habitually painted as the devil in all this, in fact has entirely legitimate concerns about the likely effect upon its own economy should the EU trade deal go through in its present form. Moscow and Kiev already enjoy bilateral free trade agreements which are at present to the benefit of both economies. Were the proposed EU free trade agreement to go through in the form favoured by the West, the melting of Ukrainian borders could result in a destabilising flood of cheap imports from Western Europe through Ukraine and into Russia, undermining key sectors of the Russian economy such as agriculture, car production and aviation and bringing in its wake the loss of many jobs. Vladimir Putin has sought to take the heat out of the situation, urging the EU to refrain from “sharp words” on the issue and gently enquiring of “our friends in Brussels”, “Do we have to choke entire sectors of our economy for them to like us?”
Ukraine’s continuing close economic relations with Russia are in some respects a legacy of the economic integration which prevailed across the former USSR when production was organised to a socialist plan, with different republics tasked with serving different aspects of the overall USSR economy. This arrangement historically enabled Ukraine to deliver the highest economic growth rates of all the Soviet republics. With the Soviet Union sadly no more, Ukraine would clearly benefit from retaining the economic stability and growth made possible by its fraternal relations with Russia and its other neighbouring republics. But you cannot have your cake and eat it. If the choice is made to engage in bilateral deals with the West on the basis of the devil take the hindmost, then it is disingenuous to expect business with the East to be conducted on the fraternal pattern established in better days. Yet it is those most infatuated with the capitalist mores of the West who are then most put out when Moscow itself conforms to those mores in its energy pricing.
This contradiction perennially surfaces around the question of the price Russia charges the Ukraine for its quota of the gas piped west through its territory to the rest of Europe. Ukraine naturally inclines to pay the “mates’ rates” which once made as much economic sense in Moscow as in Kiev; conversely Russia, now forced into a relative over-dependency on its carbon revenues, is under pressure to charge closer to the market rate. This contradiction, itself a consequence of capitalist restoration, has been exploited to the hilt by imperialism, hoping thereby to draw Ukraine into the embrace of the EU and NATO and weaken and isolate Russia.
This is what lay behind the politically motivated 2009 stand-off which saw Kiev illegally siphoning off transit gas intended for paying customers further west whilst also halting supply to those same customers. And all the signs are that reactionary forces in Ukraine are up to the same mischief again. Ukraine has now run up a natural gas bill for $882m with Russian state-run Gazprom. When in October the gas company not unreasonably suggested that future energy bills should be paid up front, Ukraine promptly announced that it would cancel all orders for the rest of the year, thereby once again sparking fears of renewed knock-on power cuts elsewhere in Europe.
Imperialism jumps the gun
However, the forces of reaction within Ukraine and their patrons in the West, calculating that the EU free trade pact was securely in the bag and that by the next elections in 2015 the country would be sleepwalking straight into the arms of the EU and NATO, have foolishly overplayed their hand. Firstly, the EU and the IMF neglected sufficiently to sugar the pill of economic restructuring, revealing with an incautious degree of candour just what a social and economic disaster the free trade pact would be, not only for Russia, but in particular for Ukraine itself. And secondly, when President Yanukovych and Prime Minister Azarov decided that this bullying was insupportable and declined to bend the knee at Vilnius, the opposition cranked up a second edition of the “Orange Revolution“, for a second time raising a petit-bourgeois nationalist mob on the street in the hope of thereby once again overturning the democratically elected leadership of the country, this time with the assistance of bulldozers, iron bars, rocks and pepper spray.
Whilst informed sources suggest that this carnival of reaction was originally planned to get geared up in 2015, timed to coincide with elections, the unanticipated setback encountered at Vilnius was such a bitter disappointment that the reactionaries could not prevent themselves from rushing ahead, in the process revealing to the world who are really the “dictators” and who the “patriots“.
Vladimir Putin’s comment on the mayhem being unleashed on the streets of Kiev, with demonstrators bussed in long distance from the west of the country, a forcible occupation of the Mayor’s office and threats to storm the parliament building, was pointed.“As far as the events in Ukraine are concerned, to me they don’t look like a revolution, but rather like ‘pogrom’,” he said, adding that “However strange this might seem, in my view it has little to do with Ukrainian-EU relations.” The clear implication here is that it is Russia and the Russians who are the real target of the reactionaries.
Speaking in the course of a visit to Armenia, Putin suggested that the protests had been prepared in advance to undermine the legitimate government of the country, and were originally timed to coincide with the presidential elections due in March 2015. But the opposition had jumped the gun. “What is happening now is a little false start due to certain circumstances… This all has been prepared for the presidential election. And that these were preparations, in my opinion, is an apparent fact for all objective observers.” He expressed the view that the protests might be serving as a cover-up for extremist activities, with the footage from Kiev showing“how well-organized and trained militant groups operate”. This analysis was backed up by Ukraine’s Prime Minister Nikolai Azarov. Detecting“signs of a coup” in the efforts made by protestors to block the government agencies, Azarov suggested that “The mass character of the action became uncontrollable, or rather controlled by certain political forces”.
These views have since been fully validated by subsequent events, with a fascist mob whipped up by the Svoboda party destroying the statue of Lenin in the centre of Kiev on 8 December, raising in its stead the fascist flag of the Nazi collaborators Bandera and Shukhevych and threatening to destroy the offices of the Communist Party of Ukraine and murder the staff. Nor has US imperialism restrained itself from the most arrogant meddling in Ukraine’s affairs, even to the extent of sending the US Assistant Secretary of State and the US ambassador out into Maidan Square to hand out sandwiches to protestors! This insolent intervention by Washington in what was supposed to be a simple disagreement between the EU and Ukraine exposes just how little this is really about establishing mutually beneficial trade talks and how much it is about the attempt to extend imperialist control right up to the Russian border.
Which way forward for Ukraine?
Driven on by the crisis of overproduction, the West has overplayed its hand in the Ukraine, using the crassest economic blackmail to draw Russia’s neighbour under the imperialist net. The rebuff it encountered at Vilnius was richly deserved. In turn the Ukrainian opposition too has overplayed its hand, driven by its bitter disappointment at the government’s eleventh hour revolt against bullying by the West to embark prematurely on carefully laid plans for another “Orange Revolution“. It seems that a putsch which had been intended for March 2015, presumably accompanied by fresh allegations of “electoral fraud“, has gone off at half-cock, in the process revealing to the world the real character of the “democrats” of the opposition. Now that the Ukrainian proletariat has had a sneak preview of the destructive social chaos with which that opposition was preparing to subvert Ukraine’s democracy, it has been given an opportunity to see how the land lies and counter petit-bourgeois nationalism with its own class interests.