Feb 5th 2015

Europe’s War in Ukraine

by Joschka Fischer

Joschka Fischer, Germany’s Foreign Minister and Vice Chancellor from 1998 until 2005, was a leader in the German Green Party for almost 20 years.

BERLIN – War is ravaging Europe’s east. Ukraine is a victim of Russian military aggression, and, like it or not, its fate will essentially determine that of Europe’s, because the current crisis will define the rules and principles that Europeans live by in the twenty-first century.

Will Europe be governed by the principles of freedom, democracy, the rule of law, and the inviolability of national borders? Or will sheer might and the willingness to use force triumph? Will “managed” democracy and spheres of influence trump the right of countries, large or small, to determine their own future?

With the Cold War’s end and the collapse of the Soviet Union, Ukraine’s independence and territorial integrity quickly became a cornerstone of the European order. This strategic fact is more evident now than ever before. Simply put, today’s democratic Ukraine is fighting for Europe’s future.

Russian President Vladimir Putin wants to restore an international order based on exclusive spheres of influence controlled by major powers – the system that prevailed in Europe’s war-torn eighteenth and nineteenth centuries. A European Ukraine and the European Union stand in the way of this goal. That is why current Russian policy seeks to destabilize Ukraine permanently, especially militarily and financially. In its own interest, Europe must not allow this policy to prevail.

Despite the war in eastern Ukraine, the country has managed to take important steps toward democracy since the ouster of President Viktor Yanukovych last February. Indeed, since the “Euromaidan” uprising began in Kyiv in November 2013, a new Ukraine has emerged. Free and fair presidential and parliamentary elections have brought to power leaders who, by implementing radical reforms, are determined to realize voters’ demands for a modern economy and an end to corruption. Nonetheless, the goal of domestic political stabilization is far from reached. Apart from tensions within the Ukrainian government, the main reason is the country’s dire financial situation.

The United States, the European Commission, and the EU’s main member states all agree, at least in principle, that Ukraine needs quick and substantial financial help in order to be able to resist Russian aggression. Likewise, they agree to support the deep social and economic reforms that Ukraine must carry out.

So far, no package has been put together, which is troublesome as the IMF is authorized to release the money it pledged only if Ukraine’s financial stability is guaranteed for at least 12 months. The country is facing a severe shortage of money, which could lead to a serious financial crisis, in addition to the ongoing and dramatic military crisis.

The EU’s difficulty in devising a concrete financial commitment stems from its dearth of financial means. A major weakness of EU foreign policy is its lack of versatile instruments for allocating financial aid to neighboring countries. It would be absurd if Ukraine were to slide into a financial crisis because the EU could not agree on how to raise the funds to prevent it.

The way to avoid that outcome is to adjust one of the EU’s two instruments for non-eurozone members to meet Ukraine’s needs: The Macro-Financial Assistance scheme, a versatile instrument that can combine loans and direct subsidies; or the balance-of-payments assistance facility, which could complement an IMF program to EU countries. Both instruments could be subject to conditions designed to ensure that the funds do not sustain rampant corruption, but flow instead to where they are needed most. Moreover, the commitments should be made in the context of a donor agreement that bars the aid from being used to make direct payments to Russia.

Today, it is more important to give adequate financial support to Ukraine than to impose new sanctions on Russia. That is why Russia may also be interested in a donor conference and fresh money from Europe for Ukraine. Indeed, economic sanctions not only exacerbate the crisis in Russia; they also negatively affect other European countries. By contrast, financial aid to Ukraine would clearly signal that the EU will not tolerate the country’s destabilization, while providing economic stimulus in Ukraine and the entire region.

Equally important, if the West’s response to Russian aggression toward Ukraine is effectively limited to economic sanctions, Putin will more easily be able to blame the West and its alleged hostility toward Russia for the collapse in ordinary Russians’ living standards, thus enabling him to double down on aggressive nationalism.

Today, the only thing needed to convert EU funds into financial aid for Ukraine is political will. The most immediate step should be an initiative by European Commission President Jean-Claude Juncker to get the funds flowing with a minimum of bureaucratic delay. Even if doing so takes some time, initiating the process would send a powerful political signal of the EU’s determination to support Ukraine. The announcement alone would help Ukraine in its acute financial plight.

Many of Europe’s leaders will meet this week at the Munich Security Conference. They should seize this opportunity to urge Juncker to start the proceedings needed to repurpose one of the EU’s two available funds. A financial crisis, in addition to the military and political crisis, would be devastating for Ukraine, and there is no good reason why it cannot be avoided.



Copyright: Project Syndicate/Institute for Human Sciences, 2015.
www.project-syndicate.org

 


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