Russia and the EU had a summit in Brussels this week, and Russia’s perpetual leader continues to underestimate the resolve of the newly-assertive, beleaguered, German-dominated EU. On a number of issues Moscow is running into a European bureaucratic phalanx—from energy and trade disputes, to human rights and Syria policy.The top issue on the agenda is energy. Despite being highly reliant on Russian gas and oil, Europe is resisting Putin’s plans to get energy to europe through the South Stream pipeline, which would circumvent recalcitrant Ukraine. The EU is unlikely to grant Russia exceptions to its energy regulations, which forbid a single firm from controlling both supply and distribution. Meanwhile the EU is continuing its antitrust investigation of Gazprom. Putin isn’t happy:
“Of course the EU has the right to take any decisions, but as I have mentioned … we are stunned by the fact that this decision is given retroactive force,” Putin told reporters on the sidelines of a Russia-EU summit in Brussels. “It is an absolutely uncivilized decision.”
This is the new Europe—rather than cozy days of old, when Putin could easily deal with the likes of Germany’s Gerhard Schroeder (who once called Putin “a flawless democrat”), Russia is being resisted on all sides by Brussels’ bureaucrats under the spell of Angela Merkel. One particularly annoying factor from a Russian perspective: Poland is increasingly emerging as a dynamic European economy and diplomatic actor, further pushing Russia to the margins.And with the ongoing energy revolution led by Western companies, the prospects of American gas exports, large shale gas reserves in the UK and Poland, and other emerging alternatives to Russian energy, especially via Turkey, Putin’s leverage in Brussels and Berlin is only likely to decrease.Russia has some legitimate concerns; as we’ve noted before, both NATO and the EU, the principal pillars of European politics, economic policy and security, exclude Russia. Finding better approaches that help integrate Russia into Europe is the best long term hope to stabilize eastern Europe and promote Russian development, but the authoritarian character of the Putin regime as well as its truculence and corruption make progress difficult.One interesting chink in Europe’s armor that gives Russia something of an opening is the situation in Cyprus. There, the country’s freewheeling banks have been crippled by their ties to mainland Greece, and major bailouts are needed to avoid driving Cyprus out of the euro. Because Cypriot banks have a well deserved reputation for dark and dirty ties with Russian oligarchs and fly by nights, opposition in Germany to a bailout runs high. No politician wants to transfer weath from German tax payers to Russian tax evaders.Russia, however, has both the money and the will to help Cyprus out. Increasing Russian influence in Cyprus through participation in the bailout will preserve a friendly banking system which presumably the Russian government finds useful in various ways and give the Russians a bit more clout inside the EU.But beyond small opportunistic openings like that one, there aren’t many good strategies for Russia in Europe right now; as Dean Acheson once said of Great Britain, Russia has lost an empire but has not found a role.