Annexing Crimea Could Be Disastrous for Russia In the Long Term

Thanks very much to Tanya Bakhmetyeva for pointing out to me this fascinating article by Andrei Movchan in the Russian online magazine “Slon” (www.slon.ru; “Slon” in Russian means “elephant” — to me the publication looks a little like “Wired” in its early days).

http://slon.ru/russia/chto_stanet_s_rossiey_posle_zakhvata_kryma_pobeda_zapada-1068817.xhtml

The title of the piece is “What Happens With Russia After The Seizure Of The Crimea? Victory Of The West.”  I’d like to summarize the points the author makes.

1. The author opposes the seizure of Crimea and believes that the Russian leadership is “entering into a dangerous confrontation with the United States, NATO and Western Europe.”

2. He is dismayed by the commentary of some Western political scientists (he names Stephen Cohen) who argue that Russia is morally and/or legally justified in taking Crimea, or at least that she can get away with it.  While the leaders of the western powers state that they are categorically opposed to Russian takeover of the Crimea and threaten sanctions, other western commentators aver that sanctions would be ineffective.  “This creates the impression,” Movchan writes, “that (the Americans and Europeans) wish to convince us that they only pretend to oppose annexation, and while in fact they favor it.”

3. But the question of whether the takeover of Crimea by Russia is “moral” is almost beside the point, and the debate obscures a more important question — is it “profitable” for Russia?

4. Russia is highly dependent on export of oil and gas to western Europe.  To protect such exports against competitors (the US, Iran, Qatar, Cyprus), she needs good relations with Europe and a powerful position in the UN.  Russia needs good relations with Kazakhstan, as a counterweight to Chinese and Turkish influence in the region, and with Azerbaijan, in part due to oil, in part to keep nationalist unrest in ethnically related Tatarstan under control.  Annexation of Crimea threatens all of these relationships.

5. Russia is highly dependent on the US and Europe for the most sophisticated technology.  She imports 90 % of what Mochvan calls “precise mechanisms and machines” — he may be talking about machine tools here, among other things.  Forty-five percent of her imports of “mechanisms and machines” are from Germany.  Without such imports Russia would not even be able to maintain a capacity to defend herself.  A Crimean takeover jeopardizes all of this.

6. Given its own many ethnic divisions, and the resentment of central power in non-Russian areas (particularly of central taxation), it is in Russia’s interest to adhere strongly to the principle of inviolable sovereignty.  Movchan mentions Chinese interest in protecting the rights of the large Chinese population around Khabarovsk.

7. Crimea is a region lacking in water, infrastructure, and energy resources.  It is politically unmanageable (“half-bandit” Movchan writes) and much of its population might wish to emigrate to central Russia.  Crimea would be a net drain on the Russian treasury at a time when spending on healthcare and social welfare are already being cut. There is no prospect that Crimea would add to Russia’s GNP, which is derived mostly from fossil fuels.  Movchan estimates that the Russian Federation would have to spend between two and five percent of its budget on Crimea.

8.  A Russian takeover of Crimea would mean a NATO presence in Ukraine without negotiations, enhanced NATO presence in the Baltics, with missile basing in both areas, possible American naval bases on the Black Sea (possibly Odessa?), Kazakh orientation towards China, and Azeri towards Turkey.  There would be a renewed threat of Georgia joining NATO.

9. Russia would be cut off from international capital markets.  The cost of borrowing to the government would rise, meaning inflation, lower GNP and a drop in imports for which Russia cannot substitute.  Even Europe kept buying Russian oil and gas, both European powers and the US would pressure other oil-rich countries to increase production, meaning that the price of oil in particular could fall — a disaster for the Russian economy.

10. Movchan believes that economic difficulties resulting directly and indirectly from the seizure of Crimea could lead to the splintering of the Russian Federation — the hiving off of Tatarstan, Bashkiria, the Far Eastern provinces, etc.

11.  Russia’s aggressive foreign policy towards its immediate neighbors, in particular the former Soviet republics, and now its move into Crimea, have been immensely self-destructive.  It is in Russia’s interest to support a neutral Ukraine, to offer closer economic ties without threats, and to guarantee Ukraine’s borders.  The same goes for the Baltic states and other neighboring countries.  Russia has a large internal market for the goods of these neighboring countries, and she has petro-dollars.  She should use these to build productive relationships rather than driving these areas into the hands of the US, Europe, and China.

Interesting piece.  His prognoses for the future of Russia should Crimea be seized seem somewhat catastrophic, but the ideas are worth thinking about.

4.

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