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Konyv4 01.Qxd INSTITUTE OF WORLD ECONOMICS, RESEARCH CENTRE FOR ECONOMIC AND REGIONAL STUDIES, HUNGARIAN ACADEMY OF SCIENCES EAST EUROPEAN STUDIES NO. 6 "THE END OF AN ERA IN EURASIA? CONFLICT IN EASTERN UKRAINE AND ECONOMIC DOWNTURN IN THE POST-SOVIET SPACE" Edited by ANDRÁS DEÁK BUDAPEST, 2015 The studies have been submited and finalized by August 2015. ISBN 978-963-301-627-5 ISSN 2063-9465 Cover design: GÁBOR TÚRY Research Centre for Economic and Regional Studies of the Hungarian Academy of Sciences, Institute of World Economics H-1112 Budapest, Budaörsi út 45. [email protected] www.vki.hu This volume was published by the generous support of the Hungarian Scientific Fund in the framework of the project "Russia as political and economic centre in the Eurasian space at the beginning of the 21. century – sphere of influence, competitors and consequences for Europe and Hungary" (OTKA K-105914). CONTENTS IN MEMORIAM ZSUZSA LUDVIG IN MEMORIAM ZSUZSA LUDVIG . .7 Miklós Szanyi ZSUZSA LUDVIG AS A RESEARCHER AND AS A PERSON . .9 Péter Farkas A YEAR AFTER... .11 András Deák THE BALANCE I WISH I COULD HAVE LEARNT FROM HER . .14 András Rácz WHAT IS THE BEAUTY OF POST-SOVIET STUDIES . .17 Va s i l y A s t r o v PERSONAL REFLECTIONS ON POST-SOVIET STUDIES . .19 Volodymyr Sidenko WHY HAS IT BEEN ATTRACTIVE TO PURSUE POST-SOVIET STUDIES? 21 László Póti THE CONFLICT IN EASTERN UKRAINE AND ITS IMPLICATIONS RUSSIA’S HYBRID WAR IN UKRAINE: WHERE ELSE COULD MOSCOW DO IT? . .25 András Rácz UKRAINE’S TRANSFORMATION CHALLENGES IN THE FRAMEWORK OF ASSOCIATION WITH THE EU AND THE CONFLICT WITH RUSSIA . .40 Volodymyr Sidenko 4 IS UKRAINE ON THE RIGHT TRACK OF ECONOMIC REFORMS? . .60 Va s i l y A s t r o v EAST EUROPEAN CRISIS: AN ATTEMPT TO INTERPRET ITS NATURE AND IMPLICATIONS FOR THE EU AND THE EASTERN PARTNERSHIP . .78 Alexander Duleba DRAWING THE BALANCE THE EURASIAN ECONOMIC UNION: RISKS AND CHALLENGES ON THE WAY TO FORMATION . .93 Svetlana Glinkina EVOLVING RUSSIAN FOREIGN AND SECURITY POLICY: INTERPRETING THE PUTIN-DOCTRINE . .105 László Póti TRACKING RUSSIAN FDI IN HUNGARY . .120 Csaba Weiner THE AUTHORS . .169 IN MEMORIAM ZSUZSA LUDVIG LUDVIG, ZSUZSA (1964-2014) 7 IN MEMORIAM ZSUZSA LUDVIG It was always a kind of challenge to study Russia or the former Soviet Union. It has never been a popular topic in Hungary. An old joke concerning three key differences between the Turkish occupation (1541-1686) and the temporary military presence of the Soviet Union in Hungary (1945-1990) explained why the Turks were able to stay longer. The first reason was that Turks did not seek to compel Hungarians to learn Turkish in primary school. The second was that they did not require Hungarians to celebrate the anniversaries of the Mohács Battle (when Turkish troops badly routed Hungarian forces in 1526). And the last, but maybe most important difference was that Turkish rulers never promised that they would stay only temporarily. The Soviet Union was therefore not really popular among young researchers of the 1980s, and this attitude carried over in perceptions of Russia in the 1990s as well. Some daring young fellows thought that it would perhaps be wiser to keep using and maintaining their Russian language skills once they had mastered the language, and thus they continued studying Russian (Soviet) society, culture and economy. These studies gave them access to a magic world of sorts! Those who did not allow negative pre- conceptions to determine their attitude and remained open to the impact of a great culture were rewarded with exceptional gifts: masterpieces of arts, original and exciting ways of thinking, and friendships with open-hearted and open-minded colleagues. They learned to view the world from the (Soviet) Russian perspective as well, which provided them with a better understanding of the forces that drive the world economy and politics. The knowledge of this insider view is a precondition for the proper understanding of economic, political and social processes in any country. Zsuzsa Ludvig was one such daring fellow. She studied Russian culture extensively and developed strong friendly ties to many Russian researchers. She also expanded her research interest to other post-Soviet states. Based on her accumulated local knowledge, she was able to understand and analyze economic and social progress in very comprehensive ways. She became one of the most renowned Hungarian experts of the post-Soviet region. Her research results were disseminated among members of the research community in several books and other publications. I am not an expert on the post-Soviet countries, but I am aware that comparisons between that region and Central Europe require a certain amount of knowledge. My 8 INMEMORIAMZSUZSA LUDVIG cooperation with Zsuzsa was based on her explaining to me many of the details and drivers of current Russian economy and politics. I could always rely on her knowledge and information. We also spent some time together at conferences and study trips in Russia, where we visited colleagues and friends. I would like to mention especially the Institute of Economics of the Russian Academy of Sciences, and our good friend there, Ms. Svetlana Glinkina. We visited her several times and also invited Ms. Glinkina and her colleagues to Hungary. These visits and meetings were always very special, allowed us to discuss the most serious topics in a friendly atmosphere, and also provided us with the opportunity to share many wonderful hours at interesting places and events both in Russia and in Hungary. Zsuzsa was deeply convinced that personal contacts could play a key role in achieving a better understanding between peoples and nations. She worked much on establishing, supporting and improving the networks between Russian and Hungarian researchers. Her passing was a major loss for the international research community. Miklós Szanyi 9 ZSUZSA LUDVIG AS A RESEARCHER AND AS A PERSON It was just after the Fall of Communism, in the midst of rampant Russophobia, when political considerations dominated over economic rationality. The billboards were full of posters with the slogan “tovarishi konec” during the electoral campaign. Politicians of the energy-importer Hungary did not care about the potential consequences of these messages on oil price negotiations with the Soviet Union. Practically nobody did care about the annual loss of 1.5 billion USD caused by switching to convertible currency in the Hungarian-Soviet trade – a move urged by Budapest. We relinquished the Russian market pretty easily. The dramatic collapse of the Russian economy, its liberalization during the shock therapy, and its integration into the world market was presented as a success by the Hungarian expertal community. Exactly during these days a slim, young lady appeared at the Institute of World Economy, Zsuzsa Ludvig. Very soon, she established herself as a respectable researcher by her balanced, detached assessments. She was widely known not only at home, in Hungary but also among Russian academics, even at the famous IMEMO. I had the privilege with other researchers to work with her on the study book, “Russia in the World Economy”, published in 2001 by Aula publisher. This book collected the most important studies of a research project under her supervision. The project attempted to identify and describe the most important facts, trends and drivers of the Russian economy in the second half of the ‘90s. Analyzing the most significant interrelations of Russian foreign trade, Zsuzsa brilliantly pointed to the domestic expertal and political misperceptions and impropriety regarding Russia. As she summarized her findings: “The thorough examination of foreign trade as the main element of economic reform or its driver raised many problems... Pushing export when sources are scarce automatically results in the realignment of resources partially at the expense of domestic production, partially by de-emphasizing particular economic sectors… The evolving import structure has also very serious, harmful effects on domestic economy. The robust advance of foreign suppliers on the markets of food and consumer goods is hardly irreversible, squeezing domestic producers. Despite all governmental efforts, this trend threatens their chances for development or even survival.” She also pointed to the degradation of export structure by the domination of raw materials, the unfavorable ecological consequences, the growing regional differences 10 ZSUZSA LUDVIG AS A RESEARCHER AND AS A PERSON etc. Her conclusions were the following: “The situation that proves to be dark even today, will become much more alarming if we consider, that despite of “taking all these problems upon herself” Russia has been loosing its share in global trade.” (Page 115- 117.) Despite all our differences in academic approaches, her independent professional attitude, readiness to resist mainstream influences, put Zsuzsa Ludvig on an academic piedestal in my eyes already in the 90s. She managed to set her conclusions on a consistent, factual and statistical basis without niggling or entering too much into unnecessary details. She was skillful in pointing to the substance and presenting the most important interrelations in a concise way. These are very import researcher’s virtues. As a research leader she also inspired her colleagues to work in a similar manner. By the 2000s, Zsuzsi set herself as a respectable, renowned expert in Russian economic studies in Eastern Europe. She became participant and organizer of many international programs. Her field of interest included the integration processes of post-Soviet region and some of its major countries, the global trends in Euro-Asia, the economic relations of European Union and Russia, and the last two decades of Hungarian-Russian relations. She analyzed each research issues in a broad context, taking into consideration the effects of global factors and processes among others. The latter was especially important in the course of analyzing the above mentioned international integration processes.
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