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Where there is no law, but every man does what is right in his own eyes, there is the least of real liberty
Henry M. Robert

Between investments and imperial pretensions

Russia so far views its natural wealth as instrument of self-isolation and blackmail
22 October, 2013 - 11:28

The just finished Azarov-Medvedev talks have unexpectedly created a soft and pleasing impression against the backdrop of hysteria on Russian TV channels. The impression is that the words “Ukraine” and “Ukrainians” trigger the attack of an unknown mental disease in the Kremlin’s agitprop men. Moreover, the same is going to happen when the words “Europe” and “European” are pronounced even out of connection with Ukraine.

In all probability, one thing must be counterbalanced with another, when it is about interstate relations. The calm behavior of Dmitry Medvedev should not deceive you, for his first-namesake Dmitry Kiselev also throws fits of Ukrainophobia. But even Kiselev’s fits are no more than a show. And it is not showmen who shape multidimensional economic, and not only economic, relations between the two states.

There is a far more serious question: who represents the Russian state whose setup more and more departs from the principles of civilized statehood? The national interests of Russia have long been replaced with the interests of a few individuals and corporations that are waging an unseen struggle in which the state is being humiliated and destroyed. The latest example is collusion between Igor Sechin and Aleksandr Lukashenko. The arrest of a Russia citizen, Viktor Baumgertner, whom the prime minister of Belarus had lured into a trap – an extremely insulting act for any state, – is only part of the rivalry for Uralkaliy in which Sechin’s Rosneft also evinces interest. A detail than remained unnoticed is that this company refuses to cut oil supplies to Belarus. It is in fact an anti-state arbitrary action.

But the latter is easy to explain – oil goes to the Mozyr refinery which is going to be bought by Rosneft which intends to monopolize oil supplies to Belarus. It also wants to supply gas there, which is a direct challenge to the export monopoly. Gazprom and Lukoil top managers have already come out against this. But only Gazprom – not as great and terrible as it wants to seem – presents interest for us in this context.

Naturally, we should take with a pinch of salt a number of publications in the Western press about Gazprom’s woes in Europe. It is not ruled out that it is part of the information war being waged against the consortium, in all probability, by Rosneft whose relations with Miller’s business have never been harmonious. But facts will be facts, and the company’s foreign partners must take them into account.

Resetting relations with Russia, which the Ukrainian premier announced recently, is undoubtedly pragmatic, but which Russia does he mean? For this brand is used by one company today and by another tomorrow. This is quite possible. And while Aleksei Miller no longer conducts pipeline shutoff shows, others may view this as a publicity stunt that confirms their exclusive status. In fact, shutting off the valve in front of TV cameras was this kind of confirmation for Miller, too, for no other than he was instructed to deprive Ukraine of gas in mid-winter.

But so far Gazprom represents Russia in all matters that concern the deliveries and transit of gas. It is therefore useful to separate what is being said and written about it as part of the information war from what is a true picture.

And the supposedly cash-for-coverage articles also contain some credible information – they always mix facts with their tendentious interpretation.

Yes, indeed, Gazprom has some antimonopoly law problems with the EU, but these are chronic problems. The point is that Europe’s accusations may well receive quite a peaceful answer: Gazprom will lose its monopoly positions. The process is underway. The consortium is no longer a monopolist on the liquefied natural gas market. It has been upstaged on the domestic and foreign market. But the long-term problems are different – it is struggle for the Arctic shelf, where the interests of Gazprom and Rosneft are at loggerheads. The crucial question is who will receive foreign investments.

This point exposes narrow-mindedness of the energy empire concept which has already flopped in the European (including Ukrainian) direction. The strategy of considering the Arctic as exclusive property of Russia, a raw-material superpower, runs counter to economic reality – it is impossible to develop the Arctic without investments, but the people who control this development in Russia are torn apart by the desire to grab these investments and the intention to attain their imperial goals.

Let me turn back to a publication I wrote four years ago, which regarded this problem as part of a forecast for the next few years. Here is the story.

The agitprop spread long ago a lie about Madeleine Albright. She allegedly said that Russia unjustly possessed all the hydrocarbon resources which in fact belonged to humankind as a whole. The operation was literally conducted at the highest level, with Vladimir Putin being one of the executors. We laughed a little and forgot. Meanwhile, it is high time to recall it because the course of thoughts was right, so to speak. No matter who and why invented Albright’s words, he or she hit the bull’s-eye. Russia’s integration into the world community requires a new attitude to such natural (or God-sent, whatever you like) riches as hydrocarbons and transit territory. They determine Russia’s mission in the world, which is quite realistic, down-to-earth, and attainable here and now – without any messianic aspirations so typical of the current generation of leaders.

The absolute opaqueness of the gas sector gives rise to all kinds of assumptions. One must admit, without going into details, that, as time goes by, it will be increasingly difficult for one country to tap the natural resources of Russia. It must be clear that Russia’s mission is to make sure that her natural resources are tapped fairly and to the benefit of the international community as long as these resources are still needed.

This is impossible without a radical reappraisal of values, unconditional renunciation of untenable imperial concepts, and replacement of them by the concepts of democratic development and energy donorship.

But, so far, the national wealth is being viewed as an instrument of self-isolation and blackmail – not only with respect to Ukraine and other European states. The experience of some Western companies that have forged links with Russia shows that the current Russian authorities regard them as potential victims, not as partners. Russia will be glad to receive investments, but investors will receive no guarantees.

Dmitry Shusharin is a Moscow-based historian and political journalist

By Dmitry SHUSHARIN, special to The Day