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EU and Russia (EUC Report)

My Lords, I am a member of Sub-Committee C. I pay tribute to the noble Lord, Lord Roper, for his excellent synopsis and wise observations today and, together with the staff and our adviser, for steering the committee to consensual and realistic conclusions. The question is whether, following the events in Georgia in August—since when an amendment has been moved—we are now in a different age that justifies a supplementary report. Certainly, as has been said, in its immediate response to the invasion, the European Council decided to conduct a comprehensive review of EU-Russian relations, which will continue until the EU-Russia summit in Nice on 14 November, and has suspended negotiations on a new EU-Russia partnership and co-operation agreement. There were of course already major changes in Russia’s attitude to the West, probably dating from 2002-03, when internal reforms in Russia were frozen and there was a tidal wave of new gas and oil money. As the noble Lord, Lord Skidelsky, said so well, relations with the United Kingdom had already been bad over the previous four years, with visits frozen—one thinks of TNK-BP and the British Council, which the Russians conceded had been singled out for political reasons. Correspondingly, there had been a sea change in the West’s attitude to Russia. In the 1990s, we had attempted to recreate Russia in our own image and had welcomed it into organisations such as the Council of Europe as if the country were on the road to a western-style liberal democracy. We had ignored the long history of authoritarianism, of western rivalry with Russia at its borders from the great game of the 19th century to the near abroad of today, the Russian fears of encirclement and anger in Russia at the depredations of the oligarchs who had stolen so many of the state assets. Russia had of course been invaded by Napoleon and Hitler. We had underestimated Russia’s deep humiliation at its loss of world status and given insufficient weight to the warning of President Putin two years ago that Russia also had the right to be self-interested. The truth is that Russia is not and never has been a western-style democracy. We should end the illusions of the 1990s and build a new relationship. We should recognise that sovereign democracy, as defined by the Russians, is a world away from democracy in the western style and closer to the authoritarianism of both the tsars and the Soviets. We should build a relationship with Russia based on a new realism, robustly defending our interests as Europeans but also building areas of co-operation where possible, with our eyes fixed on our medium-term and longer-term interests. To what extent has the invasion of Georgia changed the analysis in our report of last May? What lessons should we draw? What action should we take? The starting point is of course that it is quite unacceptable to change the frontiers of Europe by force. There may have been a miscalculation by the President of Georgia but there was an immediate and disproportionate response by Russia. Russia has allowed the ethnic cleansing of South Ossetia and recognised the independence of the breakaway provinces—potentially, at least, in respect of South Ossetia, on the way to Russian annexation—wholly contrary to international law and recent UN Security Council resolutions, such as that in April, to which Russia was a party. Its attempts to draw parallels with Kosovo are little more than debating points. Nevertheless, my judgment is that the key conclusions of the report are probably still valid and our concerns justified. Should a price be paid for the invasion? Certainly Georgia has paid a price—the probably permanent loss of territory, the deaths of its citizens, internally displaced persons and the damaged infrastructure. Russia, too, will and should pay a price. Today, the stock market has been closed—of course, there was a whole series of other reasons for that—and there have also been important private sanctions. In the six weeks after the invasion, foreign investors withdrew US$56.7 billion from Russia; they perceived that it was not a stable business environment. Russia has isolated itself politically, being joined in its recognition of the breakaway provinces only by Nicaragua. The international community will have a new suspicion of Russian intentions and abandon much of the wishful thinking, which gave Russia the benefit of many doubts. There will be a lack of trust and good will. Increasingly the G7 will meet as the G7 and not the G8. That said—this theme was taken up by a number of speakers—we must recognise that we have a mutuality of interest in a number of key areas, not just in the market for gas and oil. Last year, Russia provided 38 per cent of EU gas imports and 33 per cent of EU oil imports. We also have common interests in areas such as counterterrorism. Russia itself has been a major victim of terrorism in the Caucasus. It provides access for our military and aid effort in Afghanistan. We need its co-operation over non-proliferation policy, the trafficking of nuclear materials and the physical protection of nuclear sites in Russia, as well as, obviously, in other foreign policy areas, such as the Middle East peace process. Given the lack of airlift capacity in the western alliance, it is Russian helicopters that will transport aid and military personnel to Chad. So Russia is showing a serious interest in helping in crisis-management operations. What should our response be? Obviously, we should seek the greatest possible measure of EU unity. We should prevent the bullying of EU states such as Estonia and Poland and the attempt by Russia to have solely bilateral deals on oil and gas supply. Unfortunately, the pass has already been sold by a number of EU countries in forming long-term energy contracts with Russia. We should have greater care in relation to energy security. It is interesting that the new Government in Germany are seeking a new energy stockpile. We should look at areas such as a European Union grid to prevent shortages in one country going across frontiers. Clearly, as has been said, we should diversify sources of energy. There should be increased support for the Nabucco project. The brief interruption of the pipeline supply to the West may have meant that Nabucco is now on track for construction between 2010 and 2013. Perhaps my noble friend will indicate whether that is true and what priority status for Nabucco means in practice. We should deal with Gazprom in a more hard-nosed way, insisting on principles of reciprocity, transparency and unbundling, as has been said by a number of commentators, treating Gazprom no differently from Microsoft. There should also be equal investment rights and third-party access to pipelines. As Edward Lucas says in his book The New Cold War, we should avoid the Finlandisation, or what he rather unkindly called the ““Schröderisation””, of western Europe. We need to select areas where our interests clearly coincide, particularly as the weight of China, India and Brazil increases in the world. We need to respond to President Medvedev’s call for greater consultation. That is certainly not happening in a number of key and sensitive areas, which has given the Russians a greater argument. We need to work together in a series of non-controversial areas, including—pace the British Council—culture, and realise that not everything is political. We are aware of the provocations, the needling by Russia in areas such as Zimbabwe and Venezuela. We ourselves should avoid provocations wherever we can, such as the US withdrawal from the ABM treaty. The Russians will criticise the missile defence proposals, but I understand that, privately, they accept the sites in Poland and the Czech Republic. More debatable is the decision taken by the NATO council in April to work towards bringing Georgia and the Ukraine into NATO. I understand the argument that the new democracies should be able to make their own judgments. Perhaps contrary to what the noble Lord, Lord Skidelsky, and others have said, the pass was already sold when the NATO council made its decision to move towards membership action plans in April. Any concession now would be construed as weakness. However, we appear to have ignored proper consultation with Russia and to have given insufficient weight to the traditional NATO concepts: would the accession of these new members add value to security and are we able to enforce an Article 5 guarantee in respect of those countries? We should not make promises on which we cannot deliver. Greater EU involvement, rather than NATO involvement, leading possibly to membership, is far more acceptable and much less threatening and provocative. There are signs that, after the invasion of Georgia, Russia has recognised its isolation and the damage to its interests and is seeking to build a better relationship with the West. The speech by President Medvedev at Evian this week has already been cited. His proposal for a new European security treaty is not new, but it was warmly welcomed by President Sarkozy. I ask my noble friend whether Sarkozy was speaking on behalf of the presidency and how much consultation there was when he made that immediate response. In that speech, President Medvedev reiterated his concerns about a unipolar world—that is, US domination. Although his theme was broadly conciliatory, he called, first, for a world based on the rule of international law; secondly, he called for the abandonment of war as an instrument of policy; thirdly, he endorsed the central and co-ordinating role of the UN; and, fourthly, he called for respect for the sovereignty, territorial integrity and political independence of states, which sounded astonishingly hollow in light of the invasion of Georgia and Russia ignoring its formal international engagements. As in relation to Georgia and others, Russia has ignored those international commitments that it made in 2000 at the OSCE to withdraw its troops from areas of the frozen conflicts. There may be some merit in the proposals, but surely one should respond to them with great caution. As a first step, the most appropriate response is to put Russia to the test by seeking confidence-building measures, such as movement on other frozen conflicts in its near abroad area, evidence that the President is serious in his call for greater transparency of companies and the removal of barriers to international trade. Overall, we must recognise, as the noble Lord, Lord Skidelsky, said, that our ability to influence Russia is limited, that talk of Russia as a strategic partner is, at the very least, premature and that Russia is not as strong as we think it is. One thinks of demography, bureaucracy and so on. Also we are not as weak as we Europeans sometimes think we are. We need to respond to invasion in a way that is consistent with our principles and interests but still look for areas of co-operation with Russia on the basis of political realism and avoiding those illusions of the past. When we look back over 15 to 20 years, we remember that the Berlin Wall, the Soviet Union and communism were still in place. I firmly believe that in, say, another 15 to 20 years—a similar timescale—commentators will note that there was much sound judgment and good analysis in the report.