In a speech given at the Centre for Eastern Studies in Warsaw, Steven Pifer discusses the past and future of Ukraine, and its relationships with Russia and the West.

I think if we go back and look at 2005, we can see that a lot of opportunities were missed. I think president Yushchenko and Prime Minister Tymoshenko bear some responsibility for that. But it’s also true if you look over the Yushchenko years that a good portion of the Ukrainian leadership and most of the Ukrainian public did not share his vision for Ukraine. Of a Ukraine integrated in Europe, in particular of a Ukraine integrated in NATO. And I don’t think that was really an anti-NATO sentiment on the part of Ukrainians, but simply a view that getting to close to NATO would cause difficulties in relations with Russia. And most Ukrainians did not want to see a difficult relationship with Moscow. So it appears that Ukrainians would like a slower westward course than that articulated by Yushchenko. Certainly interest remains in Ukraine in joining in and integrating into the European Union, but not to NATO. And also there is interest in a stable relationship with Russia.

Now on the other hand I think the question comes up: Does it make sense for Ukraine to draw too close to Russia? And certainly relations between Moscow and Kyiv have improved over the last 8 months and that’s a good thing for Ukraine, but it is also important to bear in mind that on a number of issues the interests or Russia and Ukraine are not fully aligned.

Just a few examples: on the question of both gas purchase from Russia and gas transit to Ukraine. Obviously there is a contradiction in interests. The lower the price set for gas, the better for Ukraine but the worse for Russia. So there are going to be issues where the interests don’t converge. Likewise with South Stream, I think it’s interesting that despite the eight months of improving relations between Moscow and Kyiv, Russia still seems to be determined to proceed with the construction of the South Stream pipeline through the Black Sea. And at this point Russia has not identified new gas deposits for that pipeline, so if the pipeline is built any gas that goes through that pipeline will likely come from gas that currently transits to the pipelines running through Ukraine. Another area of difference is that Russia does talk about a sphere of privileged interest, a sphere of influence. And what this appears to be is that Russia would like from its neighbors that they would defer to Moscow on issues that Russia defines as central to its interests. And that has the possibility in ways to constrain Kyiv’s field for maneuver. Finally an issue on Russian economic penetration in Ukraine. And in many cases that’s a plus because it brings an investment, but particularly when we’re talking about Russian parastatal companies, they also bring in political connections. Ukraine has to ask what that means for the positive way of Ukrainian sovereignty. Russia is an important partner for Ukraine but it also is advisable for Kyiv to seek balance in this relationship. And finding that balance between relations with Russia and relations with the West is probably the best course for Ukraine today. In late March I was in Ukraine with a group including Javier Solana and we met with President Yanukovych and other senior Ukrainian officials and they made very clear that their first priority in foreign policy was to repair relations with Russia, and their view was that under Yushchenko that relation had deteriorated in a way that was not healthy for Kyiv. But they also were very clear that this would be in a context of an overall policy that would balance the relations with Russia on the one hand with relations with the West. And here at this point, eight months after President Yanukovych has taken power, I think that it is very clear that Ukraine has done a lot in terms of restoring relations with Russia: the Kharkiv Agreement, deals in the nuclear and aviation sector are being discussed and we have frequent meetings between President Yanukovych, President Medvedev and Prime Minister Putin.

But the question arises: Is Ukraine working as actively as it could to develop relations with the West and the European Union in particular? If Ukraine can achieve in 2011 a conclusion of an Association Agreement, a comprehensive deep free trade arrangement with the European Union, and a Visa Liberalisation Agreement at that point you can say, yes, Ukraine has achieved balance. But doing that in the course of the next year is not going to be easy. And it will require that Ukraine and the government make some very hard decisions, for example about joining the Free Trade Association, that will harm the risks of some of the benefactors of the Yanukovych government.

So, there are going to be some difficult decisions that will have to be taken, if they can bring the Free Trade Arrangement to closure. In the meantime, at the end of November, President Yanukovych suggested that Ukraine might turn to look at the Customs Union and the Single Economic Space and that has raised some questions because quite clearly Ukraine can’t do both. It either joins the Single Economic Space or joins the Free Trade Arrangement group, but the two are not really compatible. If Ukraine would have turned back towards Custom Union and the Single Economic Space, I think it would run the risk for Kyiv of becoming overly dependent on Russia in a way that might not be healthy.

Let me make just a couple of comments on democracy issues within Ukraine and I believe those issues are not helping Ukrainian foreign policy. Another perception in the West is that Ukraine over the last eight months has been regressing on democracy. On media issues I actually think some of the criticism is overstated and you don’t have in Ukraine direct government pressure on the media, but you do have unfortunately news media owned by big business that do not want trouble with the government so they’re self-censoring. But I worry more about the October local elections. Without debating the particulars of these elections, it’s clear that as a democratic process those elections failed to meet the standards that were established by the four previous elections. And that’s not good for the image of President Yanukovych that the first election that’s run on his watch does not live up to the standards set by his predecessors. Likewise the decision by the constitutional court to change the constitution and say basically: “Oops, we made a mistake and throughout five years of constitutional basis” is a bit hard to understand. Again, it doesn’t mean that there shouldn’t be a reform of the constitution in Ukraine, but to have it done by a court that doesn’t have a lot of legitimacy or is not seen by a wide part of the public as impartial as opposed to doing it through an inclusive political process including the opposition, was a mistake. So these sort of things they’re not good for Ukraine domestically, but they’re also not good for Ukraine’s foreign policy. The European Union is, as it often is, preoccupied with internal problems: the euro crisis, still putting in place the mechanisms of the Lisbon Treaty; and I think there are number of people in the European Union that are simply unenthusiastic about engaging Ukraine. And part of this goes to, as was mentioned before, this famous enlargement fatigue, but I think because of that you don’t have the same interest in Ukraine that there was earlier. And as the extent of this perception takes hold that the democracy in the Ukraine is moving into wrong direction, it’s going to lead to loss of interest in Ukraine on the part of the European Union. And there is parallel issue in Washington which is giving everything else on the president’s plate in foreign policy: Iraq, Afghanistan, Iran, North Korea. It’s hard for Ukraine to get up there. It’s going to become even harder still if this image of democratic regression takes hold.

I do think that Ukraine is running a risk in terms of not being able to have that balance between its relationship with Russia and the relationship with the West, and that leads to a situation where Ukraine might be overly dependent on Russia and Ukrainians have to ask themselves if that’s a healthy situation. Personally, I don’t think so. So what should be done?

I would make a couple of suggestions to Ukraine. First of all, I think it makes sense to press very hard and to make the tough decisions: conclude the Association Agreement, finish what needs to be done to join the Free Trade Arrangement and finish the Visa Liberalisation Regime. That will give Ukraine a real bond to the European Union and a real push to European integration. Second, in the case of NATO it’s very clear that Ukraine today is not interested in the Membership Action Plan, but Ukraine should certainly continue practical cooperation in NATO, particularly at the time when Russia-NATO cooperation seems to be moving forward. And finally, the case of the United States; I think Ukraine ought to look for issues, positive issues that can be developed, for example that next year’s Strategic Partnership Commission meeting on February 2011 may be the basis for a presidential meeting.

What should the Europeans and the United States do? First of all, for the European Union, don’t raise the bar. You’ve established the standards and requirements for a Free Trade Arrangement and an Association Agreement. If Ukraine gets close to those, please do not move the goal posts. The second piece of advice for the European Union and United States is: continue to press Kyiv very hard on democracy. I was in Kyiv last week and what I’ve heard across the board from people in opposition – but also close to him in the government – was that president Yanukovych is sensitive and he does care about his image in the West. And that gives the West leverage, and I think the West should use that leverage first and foremost to press Ukraine to create as much democratic space as possible. Third: stay engaged. Even if engaging Ukraine can be frustrating, as somebody who has worked on understanding Ukraine for 18 years now, I know that is not the easiest country to deal with, but at the end of the day a Ukraine that in fact is balancing between the West and Russia, a Ukraine that has more field for maneuver is certainly better than a Ukraine that is overly dependent on its Eastern neighbor. And that’s good for Ukraine and also good for Europe.