When you cross our eastern border: structural crisis, oligarchy but also solid growth

wnp.pl - 29-09-2017
Photo by PTWP

Cooperation with countries beyond our eastern border is a must. However, note should be taken that they are very different countries and actions adjusted accordingly - this is a conclusion from the “Closest Europe” debate that was held at the Eastern Economic Congress.

Eastern Poland is frequently perceived as a gateway to the east, including in an economic context. At first glance it may seem that the location is suitable for our border regions to play such a role. However, in practice it may prove otherwise - politics often proves a barrier in developing mutual commercial contacts, like, e.g. the continued tensions (with varying intensity) between Belarus and the European Union or the war in Ukraine increasingly complicating (to say the least) business relations.

Various countries, various interests

Do the European Union or Poland have an idea how to develop their relations with the East? An answer to this question was sought by those participating in the discussion at the Eastern Economic Congress.

“The European Commission and the European Parliament have been pursuing the concept of Eastern Partnerships”, said Arnoldas Abramivicius, deputy chairman of the European Committee of the Regions. “Problems have arisen with complying with certain deadlines”, he added. Where do the problems come from? Diversity among other things. “Three out of six countries declare that they are strongly pro-European: Moldova, Georgia and Ukraine. On the other hand, these countries have border problems since their great neighbour - Russia - wants to slow down their pro-European aspirations”, he clarified.

“The other three countries: Belarus, Armenia and Azerbaijan, follow their own paths eastwards. We don’t have to criticise them but certain actions will have to be taken”, added the deputy chairman of the European Committee of the Region.

In the opinion of Adam Eberhardt, director of the Centre for Eastern Studies, there is something that all of the countries of the former Soviet bloc have in common: crisis. “The East covers very different countries - democratic and non-democratic, those that have a western development vector and those that turn towards Russia. They are different in terms of religion, culture and way of life. However, at the same time there are a number of elements that make them similar. What unites them is crisis, necessarily measured by GDP indicators. The post-Soviet area is immersed in a structural crisis. The crisis is a permanent condition and the peripheral status of the area has been becoming increasingly apparent”, said Adam Eberhardt. “The accession prospects of Georgia, Ukraine and Moldova are retreating. This is due not only to the shortcomings of the East European countries but also a result of transformation in the European Union”, he added.

In his opinion, the crisis manifests in the catastrophic situation in all East European countries, intensified by the wave of migration (just remember the millions of Ukrainians working in Poland or the emigration of one third of Moldova’s population), poor infrastructure, especially in provincial areas, or, finally, the bureaucratic and oligarchic model of power.

A good example of Kazakhstan

In his opinion, Kazakhstan stands out as a clear positive against that background. “Kazakhstan is the sole country to have been following the most solid growth”, stated Eberhardt.

Some of the secret of this success was revealed by Kazakhstan’s ambassador to Poland, Margulan Baimukhan. “For 26 years since we gained independence we have been going through a very dynamic period of transformation”, said the ambassador, and he added that at the beginning GDP per capita in his country was about USD 300, whereas now it is just under USD 10 thousand.

In Baimukhan's opinion, the effects are due to his country's multi-vectoral policies. Kazakhstan, as a country located between two powers - China and Russian - must have good relationships with both countries and have its economic strategy adjusted to reflect this. “But we have not forgotten Europe”, declared Baimukhan. “The EU remains a strategic partner for Kazakhstan; e.g., with Germany our trade amounts to USD 7 billion and with Poland, which is number two in the region, about USD 1 bullion”, he stressed.

The deputy chairman of the European Committee of the Regions admitted that Kazakhstan is so far away that hitherto it has not been covered by any EU partnership programs. One might say that when there are no problems, special attention or dedicated support programs are not necessary.

What about Ukraine?

The situation is different with Ukraine, which remains the EU's focus.

“This is the most important country in terms of the programs we have been pursuing. Ukraine has been trying to align to Europe's legislation despite corruption. We can see a light at the end of the tunnel”, said Arnoldas Abramivicus.

A light may be there to see but the assessment of our eastern neighbour is not clear.

“Ukraine is our greatest hope”, admitted Adam Eberhardt. In his opinion, this is the effect of two revolutions that are evidence of a strong civic society and the memory of those efforts should be an effective vaccine against authoritarian government.

“However, we cannot forget the problems”, warned the head of the Centre for Eastern Studies. “In Ukraine, the war with Russia has more and more frequently been becoming an excuse for reinforcing soft consolidation elements of power around the president”, he added. In his opinion, the situation is somewhat similar to Russia in the mid-1990s. When the liberal and pro-democratic (and supported by the West) president Boris Yeltsin talked about reforms and tried to implement some, Russia was being transformed into an oligarchic state. “We must distinguish between the rhetoric of reforms and the actual limitations that result not only from the ill will of those in power but also from the bureaucratic and oligarchic model”, said Eberhardt, adding that the attracting of Ukraine by Europe has been losing momentum.

“In Ukraine the impact of the oligarchic system on life is gigantic. This is the major obstacle to democratic development in Ukraine. Decisions are taken in the interests of specific groups of oligarchs”, admitted Wojciech Balczun, until recently the head of Ukrainian railways. “For them it is obvious that compromising materials exist for all person who function in public life”, he added. On the other hand, he stressed that there are lots of well-educated people in Ukraine, open to the world who do want to change their country, and Ukraine itself has an enormous economic potential, perceived by the richest countries that are present and active there.

Do not forget Belarus

Kazimierz Zdunowski, chairman of the Polish-Belarus Chamber of Industry and Trade, asked us not to forget Belarus. It was only a few years ago when our trade turnover with Belarus was the same as with China. In his opinion, it is political conditions that pose an obstacle to developing Polish-Belarussian commercial relationships. “When Poland was joining the EU, there was a principle that certain countries could negotiate privileged relations with non-EU countries, like Italy with Libya. We failed to do that. As a result, we have better legal relations and treaties with Libya than we do with Belarus”, he said.

He added that in the context of the changing economic global geography where China is becoming an economic super power, Poland should find a place for itself by relying on its location and improving its relations with the East. “Poland and Belarus should move from being peripheral countries to central countries”, said Zdunowski.

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