Summit of Failure: How the EU Lost Russia over Ukraine

http://www.spiegel.de/international/europe/war-in-ukraine-a-result-of-misunderstandings-between-europe-and-russia-a-1004706.html

Summit of Failure: How the EU Lost Russia over Ukraine

By SPIEGEL Staff

November 24, 2014

DPA

One year ago, negotations over a Ukraine association agreement with the European Union collapsed. The result has been a standoff with Russia and war in the Donbass. It was an historical failure, and one that German Chancellor Angela Merkel contributed to.

Only six meters separated German Chancellor Angela Merkel and Ukrainian President Viktor Yanukovych as they sat across from each other in the festively adorned knight's hall of the former Palace of the Grand Dukes of Lithuania. In truth, though, they were worlds apart.

Yanukovych had just spoken. In meandering sentences, he tried to explain why the European Union's Eastern Partnership Summit in Vilnius was more useful than it might have appeared at that moment, why it made sense to continue negotiating and how he would remain engaged in efforts towards a common future, just as he had previously been. "We need several billion euros in aid very quickly," Yanukovych said.

Then the chancellor wanted to have her say. Merkel peered into the circle of the 28 leaders of EU member states who had gathered in Vilnius that evening. What followed was a sentence dripping with disapproval and cool sarcasm aimed directly at the Ukrainian president. "I feel like I'm at a wedding where the groom has suddenly issued new, last minute stipulations."

The EU and Ukraine had spent years negotiating an association agreement. They had signed letters of intent, obtained agreement from cabinets and parliaments, completed countless diplomatic visits and exchanged objections. But in the end, on the evening of Nov. 28, 2013 in the old palace in Vilnius, it became clear that it had all been a wasted effort. It was an historical earthquake.

Everyone came to realize that efforts to deepen Ukraine's ties with the EU had failed. But no one at the time was fully aware of the consequences the failure would have: that it would lead to one of the world's biggest crises since the end of the Cold War; that it would result in the redrawing of European borders; and that it would bring the Continent to the brink of war. It was the moment Europe lost Russia.

For Ukraine, the failure in Vilnius resulted in disaster. Since its independence in 1991, Ukraine has strived to orient itself towards the EU while at the same time taking pains to ensure that those actions don't damage its relations with Moscow. The choice between West and East, which both Brussels and Moscow have forced Kiev to make, has had devastating consequences for the fragile country.

But the impact of that fateful evening in Vilnius goes far beyond Ukraine's borders. Some 25 years after the fall of the Berlin Wall and almost 70 years after the end of World War II, Europe is once again divided. The estrangement between the Russians and the Europeans is growing with Moscow and the West more inimical toward each other today than during the final phase of the Cold War. It's a reality that many in Europe have long sought to ignore.

The story of the run-up to Vilnius is one filled with errors in judgment, misunderstandings, failures and blind spots. It is a chronicle of foreign policy failure foretold -- on all sides. Russia underestimated the will of Ukrainians to steer their country toward the EU and was overly confident in its use of its political power over Kiev as a leverage.

For its part, the EU had negotiated a nearly 1,000-page treaty, but officials in Brussels hadn't paid close enough attention to the realities of those power politics. Even in Berlin, officials for too long didn't take Russian concerns -- about the encroachment of NATO and the EU into Eastern Europe -- seriously enough. The idea that Moscow might be prepared to use force to prevent a further expansion of the Western sphere of influence didn't seem to register with anyone.

With the special role it plays and the special responsibility it has for Europe, the meltdown also represented a failure for Germany. Foreign policy has long been considered one of Chancellor Angela Merkel's greatest strengths, but even she ignored the warning signs. Merkel has proven herself over the years to be a deft mediator who can defuse tensions or work out concrete solutions. But crisis management alone is not enough for good foreign policy. Missing in this crisis was a wider view and the ability to recognize a conflict taking shape on the horizon. Instead, officials in Berlin seemed to believe that because nobody wanted conflict, it wouldn't materialize.

Merkel did say at the summit that, "The EU and Germany have to talk to Russia. The Cold War is over." But the insight came too late.

Kiev, The Presidential PalaceFeb. 25, 2010

Viktor Yanukovych was sworn in as president of Ukraine on Feb. 25, 2010 by the Verkhovna Rada, the country's national parliament. The first guests he would receive as president were chief European Union diplomat Catherine Ashton and European Commissioner for Enlargement and European Neighborhood Policy Stefan Füle.

Was it a sign?

During his inaugural address, Yanukovych had rejected the clear Western orientation of his predecessor Viktor Yushchenko. Instead, he said Ukraine should become a "bridge" between the East and West. He envisioned Ukraine's future as a "European bloc-free state."

But not long later, he found himself sitting together with Ashton and Füle inside Mariyinsky Palace in Kiev, the official presidential residence. The two had brought a piece of paper with them, which they used to present what they called the "matrix," Yanukovych's choices. It was their own, very bureaucratic way, of describing Ukraine's path to a European future. They handed him the matrix as if it were some kind of gift.

"We have never done this before for anybody," Füle said. Both European leaders considered the paper to be a pledge of confidence.

The "matrix" listed in detail what it would mean for Yanukovych if he engaged himself with the EU. To the left were the conditions he had to fulfill, including things like EU standards or the demands of the International Monetary Fund. On the right, the money was listed that Ukraine would receive if it went down this path toward the West.

Yanukovych was primarily interested in the right-hand column. When he needed money, he had always been in the habit of simply taking it -- from everyone: from his own people; from the Russian Federation; and, of course, also from the EU. Previously, during a stint as prime minister, he had mostly used his power to secure lucrative posts for members of his own clan. Indeed, Yanukovych had enjoyed a dubious reputation dating back to the clan wars in his home region, the Donbass coal basin. Even if he claimed the contrary, he never cared much about Western values. But would Yanukovych really do anything for money?

The president thanked his guests for the "matrix," the "pledge of confidence" that he hadn't actually earned. He had experienced the Europeans as naive do-gooders who were constantly going on about values and human rights but who had no idea about money. He promised both guests that the first trip he would take as Ukrainian president would be to Brussels. They understood it to be a sign, but instead it was but the first of many misunderstandings to come.

Kiev Jan. 10, 2011

Enlargement Commissioner Füle traveled to Ukraine again that January to warn Yanukovych against making any serious mistakes. Füle was genuinely alarmed.

On Dec. 20, 2010, the Ukrainian Prosecutor General's Office had filed charges against Yulia Tymoshenko accusing her of misuse of state funds. It appeared as though Yanukovych was seeking to get a former political opponent out of the way.

"Don't do it," Füle implored.

Füle was then and remains now a great believer in Europe, in the grand promise of freedom. He believes in Western values, in transparency, in the rule of law and in the EU's soft power. It was inconceivable to Füle that someone who had the opportunity to become a part of Europe could possibly refuse.

"Mr. President," Füle warned. "You're walking on thin ice." The president and the commissioner were meeting alone. Füle, who is Czech, studied in the 1980s at the Moscow State Institute of International Relations, an institution for the Soviet elite and he speaks fluent Russian, obviating the need for an interpreter. He reminded Yanukovych of his promise to reform the Ukrainian justice system. The EU even had a term, "selective justice," for the arbitrariness that prevailed in the Ukrainian legal system. Füle also reminded Yanukovych that, as expansion commissioner, it was also his job to convince EU member states of why Ukraine should belong to Europe.

Was it absolutely necessary for the European public to see just how far removed Ukraine still remained from the Western idea of rule of law? Tymoshenko is one of, if not the only, Ukrainian who is recognizable to people living in the West. She was the icon of the Orange Revolution and, despite her shortcomings as prime minister, had lost little of the glamour the revolution had bestowed upon her. Now Tymoshenko, with her trademark crown braid, threatened to become a martyr.

"You have to be 100 percent sure that this will not become a politically motivated justice," Füle said at the time. Yanukovych smiled. "I promise you that our judiciary is independent," he said.

Kiev, Presidential PalaceDec. 12, 2011

Events then proceeded as Füle feared they would. In May, the Prosecutor General's Office indicted Tymoshenko a second time. At this point, she had already been in pre-trial detention for three months. It started to look as though she would get convicted. Füle asked if he could visit her in jail.

Yanukovych went over to his desk, which had a Soviet-era desktop switchboard. He pushed a button and the Ukrainian General Prosecutor quickly answered. "I have here the commissioner," Yanukovych said. "He wants to see the Lady in prison."

Kharkiv, Women's PrisonFeb. 14, 2012

It was bitterly cold on the morning the gate to the Kachanivska women's prison was opened for a bus carrying German doctors. A group of protesters stood in front of the gate shouting, "Yulia, Yulia." The group, led by neurologist Karl Max Einhäupl, the head of Berlin's Charité university hospital, then crowded into Tymoshenko's cell, a room with a small barred window beneath the ceiling. Her lawyer was also present, along with two guards. There were two doctors from Germany, three from Canada and one from Ukraine. Tymoshenko was lying on the bed. Her hair was freshly done as was her make-up. She turned to face her visitors, but the pain was so great that she could hardly move.

The EU had transformed Tymoshenko into a symbol of whether Ukraine was indeed compatible with Europe. If she were released, Kiev would be given the seal of approval for its judiciary. If she remained imprisoned, Ukraine would continue to be stigmatized as a country with an arbitrary legal system.

The doctors diagnosed a protracted slipped disc and stated that it wasn't possible to treat Tymoshenko inside the prison. The diagnosis had been a medical one, but it also served as a political verdict. "We traveled there as doctors and not politicians," Einhäupl would later say, "but that's only half the truth."

Brussels, L'Eccailler du Palais Royal RestaurantMay 30, 2012, 7 p.m.

On May 30 of that year, Füle invited two acquaintances for dinner at L'Ecailler du Palais Royal, one of the better restaurants on Brussels' noble Place du Grand Sablon. The guests included former Polish president Aleksander Kwasniewski, who had just been named as the official negotiating Tymoshenko's release on behalf of the EU, as well as Ukrainian oligarch Victor Pinchuk. They sat upstairs on the second floor so they could enjoy a bit more peace and quiet. Füle ordered a nice bottle of wine for the evening so that he could toast Ukraine's future in Europe.

"To Europe," Füle said.

Two months ago, the European Union and Ukraine officially approved the Ukraine-EU Association Agreement. Brussels had begun paving the way for the "Eastern Partnership" four years ago. The partnership envisions tight political and economic ties between the EU and the six former Soviet republics in Eastern Europe and the Caucasus. The agreements had actually been envisioned as consolation prizes for countries that were unlikely to be granted EU membership at any time in the foreseeable future.

Like so many things in the EU, the Eastern Partnership is also a compromise. The Eastern Europeans, particularly the Poles, would prefer to give Ukraine full EU membership. At the very least, they want some kind of buffer placed between their countries and Moscow. But Southern and Western Europeans are not interested in an additional enlargement round. The result is a complicated situation for EU bureaucrats. Sometimes they get so caught up in policy that they fail to see the forest for the trees.

When considering the association agreement with Ukraine, EU officials clearly didn't pay enough attention to what it might mean for Russia. And that night, although Pinchuk didn't want to spoil the positive atmosphere, he also had the feeling that the commissioner was underestimating the danger that Russia might not sit back passively as Brussels sought to bring Ukraine into its sphere of influence. He warned the commissioner.

But Füle had assumed Russia wouldn't have any objections to the treaty. "Russia had never had a problem with the EU," said sources in Brussels familiar with the negotiations. After all, hadn't Putin offered his backing for closer ties back in 2004? During a visit to Spain at the time, the Russian president said, "If Ukraine wants to join the EU and if the EU accepts Ukraine as a member, Russia, I think, would welcome this."

But a lot of time had passed since then and relations had also deteriorated. It is no coincidence that the turning point was an event in Ukraine, the Orange Revolution at the end of 2004, that ensured the election of pro-European President Viktor Yushchenko. Since then, Brussels and Moscow have been both been vying to deepen ties with countries located in the region between Russia and the EU. The term used for this in the West is "competition of integration." But in Moscow, it is seen as a battle over spheres of influence.

"You will have to find a solution that is also acceptable to Putin," Pinchuk warned the commissioner. "Things could get difficult with the Russians." But Füle believed he knew the Russians better. "It's always difficult with the Russians," he said.

Berlin, the ChancellerySpring 2012

That spring, German Chancellor Merkel was concerned about Tymoshenko, not Russia. Merkel made a phone call to the Ukrainian president in Yalta in Crimea. It was a short time before the European Cup football championships, a tournament hosted that year by both Poland and Ukraine. In April, German President Joachim Gauck had already declined his invitation to participate in a meeting of Central European heads of state in Crimea because of Tymoshenko's incarceration and now Merkel was calling in an effort to persuade Yanukovych to release her. At the beginning of the call, the Ukrainian president tried to charm Merkel. "You speak such good Russian, let's speak without a translator," he suggested. But Merkel blocked him. She spoke with the Ukrainian president as if he were a child. "I want to help," she said, "but you have to free Yulia Tymoshenko."

Brussels, European Council headquartersFeb. 25, 2013

At the EU-Ukraine Summit on Feb. 25, 2013, Yanukovych announced his intention to work more closely with Putin's customs union. The Eurasian Economic Union was Moscow's response to Brussels' growing influence, with the aim being that of creating a single market comprised of post-Soviet states, with Ukraine at its heart.

For Putin, the Eurasion Union is the core of a foreign policy plan to defend Moscow's traditional zone of influence and with which he wants to win back lost terrain. As is always the case when it comes to Russian foreign policy, it is also a question of status. Brussels did in fact offer Moscow some of the elements of an association agreement, but Russia, a former world power, didn't want to be treated like a second-class citizen in Brussels in the same way as other countries like Moldova or Armenia. Moscow insisted on its status as a major power and demanded equal footing.

The Kremlin then proposed to Brussels that negotiations be conducted between the EU and the Eurasion Union -- directly between the two blocs of power. But European Commission President José Manuel Barroso refused to meet with the leaders of the Eurasion Union, a bloc he considered to be an EU competitor.

"One country cannot at the same time be a member of a customs union and be in a deep common free-trade area with the European Union," the commission president said on February 25. He said that Kiev had to decide which path it wanted to take. The message was clear: Kiev had to choose either Brussels or Moscow.

Kiev, Premier Palace HotelJuly 27, 2013

His name wasn't anywhere on the official program and no one appeared to know that he was coming. The Russian Embassy in Kiev hadn't even been informed that Russian President Vladimir Putin would be making an appearance at a conference of his Ukrainian supporters at the Premier Palace Hotel.

"We will respect whatever choice the Ukrainian government and people make...," he said. "But there are facts that speak for themselves." The statements are far from friendly. Whereas they may have sounded like a promise to those listening in the hall, Putin's comments were both a slap in the face and a threat to the Ukrainian government.

Prior to his speech, Putin had spoken for nearly an hour with Yanukovych in the presidential palace, leaving the Ukrainian president vexed. The talk would fundamentally change Russia's position towards Kiev. Previously, officials in Moscow hadn't believed that the association agreement with Brussels could actually come to pass. The general consensus in the Russian capital had been that the EU would insist on Tymoshenko's release and that Yanukovych would never push through all the uncomfortable reforms that Brussels had demanded.

But now, Putin realized that Yanukoych actually was considering signing the agreement.

Moscow, the Interfax News AgencyJuly 29, 2013, 9:24 a.m.

Two days later, the Kremlin-aligned news agency Interfax issued a news alert warning Russian consumers against consuming Ukrainian candies and chocolates. The article quoted Gennadiy Onishchenko, Russia's chief sanitary inspector at the time, who had just imposed a sales ban on candy by Variete, Montblanc pralines and Ukrainian milk chocolate because of alleged quality and safety problems. The sweets are made in factories that belonged to Petro Poroshenko (the oligarch and current Ukrainian president) and a television station he owned had been promoting Ukraine's pro-European policies. Shortly thereafter, Moscow imposed other measures in an escalation between Moscow and Kiev dubbed by the international media as the "chocolate war". Although the term may sound sweet, the realities were anything but nice.

By then, at the very latest, officials in Berlin should have realized that Putin was going to take off the kid gloves in the battle over Ukraine.

Berlin, the Office of the German Advisory GroupSept. 20, 2013

Berlin economists had been doing the calculations for two weeks and now they finally had the decisive figure that Yanukovych's government had been waiting for. Ricardo Giucci, the head of the German Advisory Group that monitors the reform process in Ukraine, already had several impatient emails from Ukrainian Deputy Prime Minister Serhiy Arbuzov's office when he finally hit the send button. His outgoing message included an 18-page report with the title "Impact assessment of a possible change in Russia's trade regime vis-a-vis Ukraine."

The question the report addressed is what it would cost Ukraine if Moscow were to cut its facilitation of trade with Kiev. The document included tables, bar charts and explanations about the customs union. In the end, though, only one thing interested politicians in Ukraine. On page two, under the heading "summary," the report states that "Ukrainian exports to Russia would decrease by 17 percent or $3 billion per year." It provided a solid figure, from Germany, telling the Ukrainian government what it would have a sacrifice for the sake of closer relations with the EU. Should not Kiev be compensated for such a sacrifice?

Washington, IMF HeadquartersOct. 14, 2013

David Lipton sat down in front of Arbuzov's delegation. He had carried the title of deputy managing director at the IMF since 2011 and served as Christine Lagarde's right-hand man. The Ukrainians who had traveled to Washington found him to be friendly, at least compared to the IMF economists sitting next to Lipton with their frozen smiles exhibiting nothing but contempt for the Ukrainians.

It was the second trip Arbuzov had made to Washington within a period of only two weeks. By then, it had become clear in eyes of the Ukrainians that there could only be an agreement with the EU if Ukraine were to be granted a multi-billion-dollar loan from the IMF.

On Oct. 3, during their first visit, they had sought American support to secure better conditions for a possible IMF loan. The IMF had named conditions during the spring that Kiev considered to be unacceptable. They included a provision that the subsidized price for natural gas be raised by 40 percent and for the Ukraine's currency, the hryvnia, to be devaluated by 25 percent. For Yanukovych, who would have to face re-election in 2015, those steps would have been political suicide. But the Ukrainians also had the impression the IMF was ready to negotiate, not least because Victoria Nuland, the US assistant secretary of state for European affairs, had given her assurances that Washington backed an IMF loan for Ukraine.

Now the Ukrainians had come to present their counterproposal to Lipton, a plan that contained far less than what the IMF had demanded. In terms of negotiations over the EU agreement, the situation was becoming tenuous.

• Part 1: How the EU Lost Russia over Ukraine
• Part 2: Four Thousand Deaths and an Eastern Ukraine Gripped By War