Lithuanian Annual Strategic Review 2009-2010

ISSN 1648-8024

General Jonas Žemaitis Military Academy of Lithuania

Institute of International Relations and Political Science of the University of Vilnius

Strategic Research Center

LITHUANIAN ANNUAL STRATEGIC REVIEW 2009–2010

Vilnius 2010 EDITORIAL BOARD

Stefano Guzzini (Uppsala University; Danish Institute for International Studies), Algimantas Jankauskas (University of Vilnius), Pertti L. Joenniemi (Danish Institute for International Studies), Kimitaka Matsuzato (Hokaido University), Petr Kratochvil (Institute of International Relations Prague), Rolandas Kačinskas (Ministry of Foreign Affair of the Republic of Lithuania), Jūratė Novagrockienė (Military Academy of Lithuania; University of Vilnius), Žaneta Ozoliņa (University of Latvia), Valdas Rakutis (Military Academy of Lithuania), Vytautas Umbrasas (Ministry of Defense of the Republic of Lithuania), Egidijus Vareikis (Seimas of the Republic of Lithuania), Ramūnas Vilpišauskas (University of Vilnius)

EXECUTIVE EDITOR Gediminas Vitkus (Military Academy of Lithuania; University of Vilnius)

MAKE-UP EDITOR Amy Elizabeth Smith

Lithuanian Annual Strategic Review, 2009-2010

This is a peer reviewed annual research publication published by the Military Academy of Lithuania in co-operation with the Institute of International Relations and Political Science of the University of Vilnius. The main objective of this publication is to provide the readers with a wide-scale analysis and generalization of the changes, both essential and significant, in relation to the national security of Lithuania at the international–systemic, regional, and national levels. The yearbook also aims to give maximum emphasis to the specificity of Lithuanian national security issues and comprehensively present them to a widely interested and concerned audience.

Preface...... 5

Global International System and Lithuania...... 7 The Interpretations of the Impact of Military Change on the International System Karolis Aleksa...... 9 NATO at 60: Lost in Transformation Kęstutis Paulauskas...... 31 NATO Transformation Scenarios Martynas Zapolskis...... 55

Changing European Security Space...... 79 European Union Sanctions Policy Martynas Lukoševičius...... 81 Regional Cooperation within the European Economic Area Mindaugas Jurkynas...... 113

Lithuania’s Eastern Neighbourhood ...... 131 Impact of the Global Financial Crisis on Russia’s Foreign Economic Policy Liudas Zdanavičius...... 133 Moldova’s Security Strategy: the Problem of Permanent Neutrality Laura Kirvelytė ...... 157

National Security Issues...... 185 Lithuania in the NATO Mission in Afghanistan: Between Idealism and Pragmatism Egdūnas Račius...... 187

5 Preface

The Strategic Research Centre of the Lithuanian Military Academy and the Institute of International Relations and Political Science of Vilnius University are proud to present their readers with, the 8th Volume of the Lithuanian An- nual Strategic Review. This volume of the Lithuanian Annual Strategic Review is devoted to the actualities and problems of the security policy of Lithuania, Europe and the world in 2009 – 2010, this despite the raging financial crisis that has considerably limited former capabilities and imposed correction of pre-planned ideas. Starting with this publication we will cover in the Review, not only the previous, but also the current year because due to certain circumstances, our publication generally comes to light only in the second half of the year. This way our authors have the possibility to discuss actualities pertaining to both the previous year and the first half of the current year. The first section of the Review is called “Global International System and Lithuania” and contains three studies. Karolis Aleksa, in the theoretical article “The Interpretations of the Impact of Military Change on the International System,” compares the impact of changes in the military under different types of international systems and proves that a military change becomes a much more destabilizing factor in the wake of the disintegration of the bi-polar international system of the cold-war time than it used to be. Two other texts in this section deal with NATO continuing to further improve its strategic conception. Kęstutis Paulauskas elaborates upon the existence problems of the Alliance and provides an assessment of Lithuania’s five-year membership within NATO, while Martynas Zapolskis employs the method of scenario building and further analyzes plausible directions of NATO transformation and their impact on the formation of foreign policy and the security policy of Lithuania. The second section of the publication, titled “Changing European Securi- ty Space,” is comprised of two studies. Martynas Lukoševičius examines the under analyzed sanctions policy of the European Union. These sanctions are largely a key measure of the European Union foreign policy, aiming at strengthening its visibility in global politics; yet according to the author, the effectiveness of these sanctions has been rather insignificant. Mindaugas Jurkynas, in his empi- ric study, explores tangents for enhanced cooperation between the European Union’s and European Economic Area’s regional cooperation mechanisms. In the third section of the “Lithuanian Annual Strategic Review 2009 – 2010, titled “Lithuania’s Eastern Neighbourhood”, readers will find studies by two researchers. Liudas Zdanavičius, in his article “Impact of the Global Financial Crisis on the Russia’s Foreign Economic Policy” assesses the consequences of the crisis on the economy of the country and discusses the main actions by Mos- cow in seeking to strengthen Russia’s weight in the global economic system. A comprehensive and multifaceted study by Laura Kirvelytė, “Moldova’s Security Strategy: The Problem of Permanent Neutrality” acquaints the reader with the peculiarities of Moldova‘s neutrality and the main problems of this security 6

strategy. Factors of Moldova‘s neutrality are herein analyzed from different theoretical perspectives. The author also touches upon Moldova‘s security dilemma in the aftermath of the war between Russia and Georgia. The fourth section of the Review titled “National Security Issues,” traditionally analyzes urgent aspects, issues, and cases of national security in Lithuania. Readers have the possibility to look through one research study. This section includes an article by Egdūnas Račius “Lithuania in the NATO Mission in Afghanistan: Between Idealism and Pragmatism,” which raises the issue, whether taking into consideration the economic situation in the entire world as well as in Lithuania and deterioration of the security situation in Afghanistan, and the tactics chosen for the implementation of foreign policy objectives, will it justify itself in the long-term perspective and what scenarios could cover its further development. We wish our readers an interesting acquaintance with the new research studies. Please, note that this and previous volumes of the “Lithuanian Annual Strategic Review” are located on the General Jonas Žemaitis Military Academy of Lithuania website of scientific electronic library and are available at all times. It is also a pleasure to point out that, starting with this edition, authoritative colleagues from Latvia, the Czech Republic, Denmark, Sweden, Finland and Japan will start supporting the editorial board of the publication with their experience and advice.

Editorial Board Global International System and Lithuania

Karolis Aleksa* Institute of International Relations and Political Science, University of Vilnius

The Interpretations of the Impact of Military Change on the International System

This article presents a theoretical approach of analysis and estimate of the influence of military change on international relations, as well as the interpretations of the impact of military change on international systems during various historical periods. The first part of the paper defines the term of the fundamental military change and the cycle of the fundamental military change in the international system; it also presents some insights of the offense-defence balance theory with the estimate of the impact of military change on international relations. The second part of the article describes various cases of the influence of fundamental military changes on the international system until the invention of the nuclear weapon (the revolutions of artillery, firearms and naval warfare from the 15th until the 17th c.). The chapter on the nuclear era provides an analysis about the role of military changes during and after the Cold War, i.e., in the contemporary international system. This article explains that until the invention of the nuclear weapon, fundamental military changes could determine the survival of a state and could provide it with exceptional opportunities to establish its power over other states. Meanwhile, during the nuclear era the impact of military transformations became much more subtle. It is claimed that during the Cold War military changes played the role of balancing the bipolar international system, whereas, after the Cold War the influence of such changes became destabilizing.

Introduction

The debates over the significance of military change to warfare (the forms and means of warfare) and to the international relations after the end of the Cold War became very popular after the US won a quick victory in the first Persian Gulf War in 1991, which was also linked with the effective use of precision-guided munitions in the conventional war1. The leaders of the US military community and some American academics began to interpret this as a consequence of the revolution in military affairs. This estimate became a starting point for Americans in renewing their plans for military development between the years 1996-1997. Besides, the maintenance of the American military power began to be associated namely with the revolution in military affairs.

* Karolis Aleksa is a PhD candidate, Institute of International Relations and Political Science, University of Vilnius. Address: Vokiečių 10, LT-01130 Vilnius, Lithuania, tel. +370-5-2514130 – karolisaleksa@hotmail. com 1 It became possible due to the adjustment of informational technologies to the military needs. 10

According to George W. Bush, who finished his term of presidential office in January 2009, “America has, and intends to keep, military strengths beyond challenge, thereby, making the destabilizing arms races of other eras pointless [....]”2. This so-called revolution in military affairs, however, gave rise to live discussions among the US defence community members themselves, which have become extremely sceptical of the US military transformation some time after the operations in Afghanistan and Iraq. There were some considerations that this transformation had stipulated the excessive belief of the US political and military leaders in the advantages of military advance as the means per se, solving the strategic political problems.3 Among sceptical estimations of the US military transformation there were some thoughts that military transformations, advocated and launched by the US are one-sided, i.e. the conventional forces are being developed in defiance of the most plausible threats.4 Debates on estimates of the American military progress have also given rise to a new wave of interest in the studies of war history and political sociolo- gy5, which analyse the influence of military change on the development of state and interstate relationships. The question of the influence of military change on international relations is one of the more significant ones analysed by the representatives from the fields of war history and international relations. The research of the influence of military change on international relations is challenging and continuously raises discussions in various academic circles due to several reasons: firstly, it is not easy to define military change as a phenomenon itself. It is important to note that there have been ongoing attempts to define the term of military change and to analyse its impact in the state interior and transnational context since the middle of the 20th century. Secondly, the estimation that distinguishes the influence of military change is analytically complicated. The military change does not affect international relations as an isolated factor – the recognition of the significance of military change by political leaders (political context), its acceptance among the international community (cultural context), and capacity to gain it (economical context) – can all be considered as its composite parts. The complexity of potential factors of the impact, and their mutual interaction, certainly burden the efforts to provide an exclusive (and thorough) assessment of the influence of military change on international relations. On the other hand, the interdisciplinary of the phenomenon bears new ideas and interpretations that render a huge surplus value in understanding the logic of the interstate interaction.

2 President Bush Delivers Graduation Speech at West Point, 2002 June 1, http://ics.leeds.ac.uk/papers/vp01.cfm?outfit=pmt&folder=339&paper=380, 10 04 2009. 3 Gray C.S, Transformation and Strategic Surprise, Strategic Studies Institute, U.S. Army War College, April 2005, http://www.strategicstudiesinstitute.army.mil/pdffiles/PUB602.pdf, 25 02 2008. 4 See: Kagan F.W., Finding the Target: The Transformation of American Military Policy, New York, London: Encounter Books, 2006, p. 200-201. 5 Especially in the circles of the American academic community, which seek to understand the significance of the contemporary military transformation. 11

Taking into consideration intensive academic discussions on the influence of the US military progress on warfare, interstate relations as well as interdisciplinary controversies, this article seeks to present a theoretical approach of analysis and assessment of the influence of military change on international relations as well as the interpretations of the impact of military change on the international systems during various historical periods. Accordingly, the first part of the article defines fundamental military change and the relationship between fundamental military change and the international system; it also provides a presentation of the insights of the offense-defence balance theory linked with the estimates of the influence of military change on international relations. Meanwhile, the second part of this paper describes the interpretations of the influence of military changes on international relations during three different periods: the Middle Ages and Modern times; the Cold War period; and the contemporary international relations.

1. The relationship between fundamental military change and international system: theoretical approach

1.1. The concept of fundamental military change

Geoffrey Parker holds that the success of the Western nations in creating the first true global empires between 1500 and 1750 depended namely on the enhanced capabilities to wage war, which is defined as the military revolution.6 Meanwhile, the apologists of the contemporary military revolution might be disappointed with Colin S. Gray’s statement that the Serbian campaign of 1999 and the Afghanistan campaign of 2001-2002 were not as successful as the forefront states of the military revolution would expect.7 These two examples simply prove that military changes create a diverse impact on the international environment, however, in order to assess the diversity of such impact it is necessary to agree upon the content of the fundamental military change concept. The definition of the fundamental military change in the Western academic literature generally involves the concepts of military transformation, revolution in military affairs, military revolution, and military-technical revolution. The concept of the military revolution is distinguished from other concepts by the fact that it implies more than military change per se. The military revolution is a part (or an outcome) of the social and political process, which changes the image of state and society as well as the image of the international community (e.g. the birth of a modern State in the 16th–17th centuries, the Great French Re-

6 Parker G., The Military Revolution: Military Innovation and the rise of the West, 1500-1800, Cambridge: Cambridge University Press, 1999, p. 4. 7 Gray C. S., Another Bloody Century: Future Warfare, London: Phoenix, 2005, p. 101-102. 12

volution and the Industrial Revolution). However, the concepts of revolution in military affairs, military transformation, and military-technical revolution specifically refer to changes in the field of war-waging (warfare). The paradigm of the discussions about the military revolution emerged during the debates of Western historians about the importance of military change and its consequences in early modern times. The studies of Michael Roberts, Geoffrey Parker, Clifford J. Rogers and Jeremy Black helped to define the main landmarks of these debates. In the article The Military Revolution, 1560-1660, Michael Roberts was the first to publish his insights of the military revolution initiated by the Netherlands and Sweden in 1560-1660, noting the essential aspects of this revolution: 1) tactical revolution (replacement of enor- mous squares of pikemen with linear formation of smaller units dominated by soldiers who use firearms); 2) strategic revolution (due to the introduced military training the permanent forces were capable of using different strategies during battles and wars); 3) the significant increase of the number of military force necessary for realizing new strategies of battles and wars; 4) the impact on society and state.8 This study by Michael Roberts prompted the appearance of other historical studies on the subject of military revolutions. Geoffrey Parker, in his study, argued with Michael Roberts regarding the true founders and the origin of military revolution; according to Geoffrey Parker, the aspects of military revolution analyzed by Michael Roberts could be envisaged some time earlier in the Renaissance Italy and in Habsburgian Spain. Meanwhile the studies of Clifford J. Rogers and Jeremy Black drew attention to the military revolutions of other historical periods. Clifford J. Rogers maintained that during the Hundred Years’ War (1337-1453) one can distinguish two essential military changes (the revolutions of the infantry and the artillery), which essentially changed warfare and could be compared to the military revolution analysed by Michael Roberts and Geoffrey Parker.9 Meanwhile, Jeremy Black in his study maintained that the military revolution of 1560-1660, distinguished by Michael Roberts, should be considered only as relative and limited military change among other fundamental military changes. According to Jeremy Black, the fundamental military change emerged namely after 1660 and continued until 1720.10 The above mentioned historians’ studies are just a few examples of the increased number of such studies.11 The historical estimations regarding the

8 Roberts M., “The Military Revolution, 1560-1660” in Rogers C. J., ed., The Military Revolution Debate: Readings on the Military Transformation of Early Modern Europe, Colorado: Westview Press, 1995, p. 13-29. 9 Ibid., p. 56. 10 Black J., “A Military Revolution? A 1660-1792 Perspective” in Rogers C.J., ed., The Military Revolution Debate: Readings on the Military Transformation of Early Modern Europe, Colorado: Westview Press, 1995, p. 97. 11 The studies of John A. Lynn, Colin Jones, Thomas F. Arnold, David A. Parrot, Simon Adams, I. A. A. Thompson, John F.Guilmartin, Jr, in: Rogers C. J., ed., The Military Revolution Debate: Readings on the Military Transformation of Early Modern Europe, Colorado: Westview Press, 1995. 13 origin and the scale of the fundamental military change, as well as its impact on warfare and the international system always depend on the availability of historical sources, and also of course on the interpretation of these sources. However, such historical studies lack an attempt to seek a common consensus on the key elements of military change as a phenomenon which could certainly bring more light into historical discussions. However, the definition of the fundamental military change did not emerge from the discussions among war historians; it emerged from the contemporary interdisciplinary debates among the Western theoreticians of strategic thought12 (war historians also actively participated in these discussions13). The idea of the contemporary military revolution, which after the first Persian Gulf War in 1991 fascinated some defence planners from the US, prompted the initiation of the research related to the historical military revolutions and thus more profound interpretations and theorizing about the concept of fundamental military changes. In one of such studies Richard O. Hundley tried to define the term of the revolution in military affairs, maintaining that it marks a paradigmic break in the nature and execution of military operations which: Make one or more core competencies14 of a dominant state15 out-of-date or unimportant; Create one or more core competencies in the new dimensions of warfare; Or the first two cases taken together.

12 See: McKitrick J., Blackwell J., Littlepage F., Kraus G., Blanchfield R., Hill D., “The Revolution in Military Affairs”, The Professional Journal of the United States Air Force, http://www.airpower.maxwell. af.mil/airchronicles/battle/chp3.html, 25 09 2008.; Vickers M.G., Martinage R. C., The Revolution in War, Center for Strategic and Budgetary Assessments, December 2004, http://www.csbaonline.org/4Publications/ Archive/R.20041201.RevInWar/R.20041201.RevInWar.pdf, 20 09 2008.; Metz S., Kievit J., Strategy and the Revolution in Military Affairs: From Theory to Policy, Strategic Studies Institute, 1995, http://www. au.af.mil/au/awc/awcgate/ssi/stratrma.pdf, 20 09 2008.; Goldman E. O., Andres R. B., “Systemic Effects of Military Innovation and Diffusion”, Security Studies, Summer 1999, vol. 8, no. 4, p. 79-125, http://www. au.af.mil/au/awc/awcgate/innovation/jciss/syst.htm, 10 02 2009.; Hawkins C. F., Brinkerhoff J. R., Horowitz S. A., A Historical Perspective on Military Transformation, http://www.herolibrary.org/transform.htm, 10 05 2009.; Isaacson J. A., Layne C., Arquilla J., Predicting Military Innovation, Arroyo Center, 1999, http:// www.rand.org/pubs/documented_briefings/2007/DB242.pdf, 10 02 2009. 13 Black J., “The Revolution in Military Affairs: The Historian‘s Perspective”, Journal of Military and Strategic Studies, Winter 2006/07, Vol. 9, Issue 2, http://www.jmss.org/2007/2007winter/articles/black_cont- defense.pdf, 20 08 2008. �� Core competence, according to the definition by Richard O. Hundley, is a fundamental ability that provides for a set of military capabilities (e.g., the competence of the US Air Force is a capacity to attack moving targets on land with an exceptional precision). 15 A dominant state is a state which possesses a dominating set of capabilities in an area of military operations. 14 Table 1. Examples of means which prompted fundamental changes in military affairs16

Revolution in the military Paradigmatic break Core competency affected affairs

Created a new tactical Ability to manoeuvre massed Machine gun level model for land infantry forces in the open warfare space (rendered obsolete) Created a new dimen- Accurate long-range missiles Intercontinental bal- sion of warfare (inter- carrying nuclear warheads listic missiles continental strategic (a new core competency) warfare)

For example, the invention of an automatic gun enabled a complete change of the tactical level of land warfare: free manoeuvres with infantry forces in order to break the defence of the enemy became impossible because of potentially huge casualties, and therefore an inescapable defeat in the battle. Thus, a slightly larger superiority of having more infantry than the enemy became unimportant due to the growing defensive power with the help of an automatic gun. Meanwhile, the invention of intercontinental ballistic missiles led to a new dimension of warfare, which did not require the physical dislocation of troops or sending them to the territory of the enemy. (See Table 1) In order to identify the fundamental military change, one needs to clearly define the cycle of such change. The identification of the fundamental military change cycle enables one to determine the existence of such change per se, which means that it is possible to draw fairly reliable conclusions on the influence of such change on warfare and the international environment. The identification of the fundamental military change becomes possible only when the change reaches the phase of exploitation. (See Picture 1)

Figure 1. The cycle of the revolution in military affairs17

generally, the fundamental military change begins with the invention of a new technology (e.g., a big bow, firearm or ballistic missiles), with the social/political revolutions (e.g., The Great French Revolution) or the creation of new methods for the use of existing means of warfare (e.g., the “blitzkrieg”)18. However, despite various factors which cause military revolutions, it is important to note that all revolutions in military affairs are united by the fact that new factors are implemented by new warfare doctrines (warfare strategy) and corresponding new force structures. Taking the above ideas into consideration, the fundamental military change is defined by the invention of a new mode of warfare that may be conditioned by the implementation of a new technology, significant social transformations or innovative use of existing warfare instruments; and which can challenge the most powerful states of the international system, which do not wish to put their security under threat or to be deprived of influence on other subjects of international system. The concepts of the fundamental military change and revolution in military affairs in this article are used as synonyms.19

�� Hundley R.O., Past Revolutions. Future Transformations. What can the history of revolution in military affairs tell us about transforming the U.S. military?, National Defense Research Institute, RAND, 1999, http://www.rand.org/pubs/monograph_reports/2007/MR1029.pdf, 15 09 2008. Note: the factor of social/ economic/political transformations is distinguished by author. 18 The military strategy applied by Germany during the World War II. 19 The concept of the military-technical revolution is narrower than the concept of the fundamental military change because it concentrates only on one of the possible factors of the appearance of fundamental military change (although there are more of them). Meanwhile, the concept of the military change marks the fundamental reform of the military forces which is unnecessarily affected by the fundamental military change. 16 1.2. Interaction between the fundamental military change and the international system

According to Michael Roberts, “the military revolution, indeed, had important effects upon international relations and international law. There can be no doubt that the strengthening of the state’s control of military matters did something to regularize international relations. The mediaeval concept of war as an extension of feud grows faint; military activities by irresponsible individuals are frowned on; the states embark on the suppression of piracy [...]”.20 However, in order to estimate the influence of the fundamental military change on the international system, it is necessary to take into account the stages of “existence” of this change as its impact on international relations may vary during different phases of its cycle. Such stages are defined as the phases of the cycle of fundamental military change.

Figure 2. The cycle of the fundamental military change21

According to Steven Metz and James Kievit, the cycle begins with the phase of “initiation” as one state (e.g., the Mongol Empire in the times of Genghiz Khan or France in the times of Napoleon) or a group of states (the European states in the 19th century) makes a step towards the fundamental military change. The fundamental military change enters the phase of “critical mass” as new modes of warfare are created on the basis of new technology or doctrinal/organizational innovations. Just after entering the phase of “critical mass”, the fundamental military change receives international response which may be symmetrical (for example, the USSR after the defeats on land in 1941- 1942 took over the methods of the operations on land carried out by German Wehrmacht) or asymmetrical (Mao’s People’s War, essentially the guerrilla war). The end of the “response” phase indicates that the subjects of the internatio-

20 Roberts M., “The Military Revolution, 1560-1660” in Rogers C.J., ed., The Military Revolution Debate: Readings on the Military Transformation of Early Modern Europe, Colorado: Westview Press, 1995, p. 27. 21 Metz S., Kievit J., Strategy and the Revolution in Military Affairs: From Theory to Policy, Strategic Studies Institute, 1995, http://www.au.af.mil/au/awc/awcgate/ssi/stratrma.pdf, 20 09 2008. 17 nal system developed appropriate symmetrical and asymmetrical means and adjusted to the fundamental military change. When balance between the main military powers is achieved, a status quo phase follows which is then broken by a new fundamental military change. Taking into consideration the distinguished development cycles of the fundamental military change, one may maintain that the analysis of the influence of the fundamental military change on international relations during its different cycle phases enables one to provide thorough explanations about the impact of the fundamental military change on international relations.

1.3. The offense-defence balance theory: the significance of the military change to international relations

Although the offense-defence balance theory is just one of the theoretical approaches that can be used to explain the influence of the military factor on international relations, however, it is considered to be the only theory of international relations, which uses the military change as the main instrument to explain the state of international relations. The main postulate of this theory is that international conflicts and wars are more plausible at times when the offense22 has superiority; meanwhile, peace and cooperation are more possible when the superiority is on the side of the defence. According to R. Jervis, the superiority of the offense enhances the capacity to annihilate the enemy’s army and to occupy its territory more quickly than to defend one’s own. Whereas the superiority of the defence helps to defend oneself rather than to move forward, annihilate and occupy the enemy’s territory.23 A relative consensus in this theory is the proposition that the military changes, which increase the mobility of forces, also strengthen the offense, while military innovations which increase the firepower are more favourable for the defence.24 Therefore, after the occurrence of military innovations, which are more favourable for the offense, it is possible to foresee that more wars will break out in the international system, which may lead to the formation of vast political units (empires); whereas, military innovations that are more favourable for the defence may result in less conflicts and may help the states retain independence and enhance mutual cooperation. According to Stephen Van

22 The representatives of this theory generally use the notion of offense and defence to refer to the affectivity of arms used against other arms. The fixed (immobile) arms strengthen the defence; the mobile arms make the offense superior. See: Quester G.H., “Offense and Defence in the International System” in Brown M.E., Cote O.R. Jr., Lynn-Jones S.M., Miller S.E., ed., Offense, Defence, and War: An International Security Reader. London: The MIT Press, 2004, p. 54. 23 Jervis R., “Cooperation under the Security Dilemma”, in Brown M.E., Cote O.R. Jr., Lynn-Jones S.M., Miller S.E., ed., Offense, Defence, and War: An International Security Reader. London: The MIT Press, 2004, p. 23. 24 Lieber K.A., “Grasping the Technological Peace: The Offense-Defence Balance and International Security” in Brown M.E., Cote O.R. Jr., Lynn-Jones S.M., Miller S.E.., ed., Offense, Defence, and War: An International Security Reader. London: The MIT Press, 2004, p. 373. 18

Evera, one of the founders of the offense-defence balance theory, the superiority of the offense implies that the states are more likely to pursue aggressive foreign policy, to use “windows of possibility” and to wage preventive wars. However, the offense-defence balance theory draws attention to the fact that the superiority of the offense or the defence may be misjudged by political leaders. For example, the leaders of the European states worshipped the Cult of Offense in 1914, completely ignoring the power of the defence – this in its turn led to the World War I.25 However as one could expect, the offense-defence balance theory received some criticism. Among the more important arguments of the critics were: 1) the main independent variable of the theory (offense-defence balance) was not clearly defined; 2) the offense-defence balance cannot be measured, because the consequences of war are very unclear (i.e., the war may not necessarily start when the superiority is on the side of offense); 3) military innovations which provided an opportunity to strengthen the mobility of forces did not always give superiority to the offense, and military innovations which strengthened the firepower did not always give superiority to the defence; 4) it is particularly complicated to attribute some historical periods to the times, when exclusive domination of the offense or the defence persisted. After trying to divide the period of 1495-1945 (encompassing 450 years) into the periods of exclusive dominance of the offense or the defence, consensus was found only regarding four different periods which encompass 185 years (two periods were dominated by the offense and the other two – by the defence).26 In response to the criticism some proponents of the offense-defence balance theory presented a more accurate definition of the offense-defence balance: “[…] as the ratio of the cost of the forces that the attacker requires to take territory to the cost of the defender’s forces.”27 Taking into consideration the fact that the proportions of the offense-defence building costs may fluctuate due to other significant factors, propositions were made to include such factors as the number of forces, the accumulation of resources, nationalism, technology and geography into the offense-defence balance calculations.28 It has to be admitted that there was a proposition to exclude the behaviour of alliances and the first-move advantage29 from the offense-defence balance calculations. The behaviour of alliances, according to Charles L. Glaser and Chaim Kaufmann,

�� Evera S.V., “The Cult of Offensive and the Origins of the First World War Security“ in Brown M.E., Cote O.R. Jr., Lynn-Jones S.M., Miller S.E., ed., Offense, Defence, and War: An International Security Reader. London: The MIT Press, 2004, p. 69-118. 26 Levy J.S., “The Offensive/Defensive Balance of Military Technology: A Theoretical and Historical Analy- sis”, International Studies Quarterly (1984) 28, p. 234. The periods under the domination of offense were 1495-1525 and 1790-1815, and the defence dominated in 1650-1740 and 1850-1890. 27 Glaser C.L., Kaufman C., „What is the Offense-Defence Balance and Can We Measure It?“ “ in Brown M.E., Cote O.R. Jr., Lynn-Jones S.M., Miller S.E., ed., Offense, Defence, and War: An International Security Reader. London: The MIT Press, 2004, p. 268. 28 Ibid., p. 283-290. 29 This term is used instead of “first-move strike” because the conflict is not only caused by the strike per se, but also by other factors (e.g., the mobilization, the drawing of forces closer to the border), which can act as the strike itself. 19 increases the success of offense in such a way that it cannot be calculated by the offense-defence balance. The variable of the “first-move advantage” does not conform to the logic of the offense-defence balance because this advantage is never one-sided: both sides of the potential conflict may have some reasons to undertake actions that can lead to conflict. All of the discussions on the offense-defence balance theory implicate the existence of at least two main trends of the interpretation of this theory. The first trend is a general one, which concentrates on the general interpretation of the condition of international relations based on the domination of offense or defence during a certain period; meanwhile, the second trend seeks to interpret the conflict between two states according to clear criteria which determine the offense-defence balance. Despite the criticism, the insights of the offense- defence balance theory are considered to be significant. The offense-defence theory gave grounds to the analysis and estimations of both the significance of military change to interstate relations and the development and condition of the international system itself. It is obvious, however, that the estimation of every historical period (based on the military change as the main variable of the interpretation) must be based not only on the calculation of the offense-defence balance, but also on the context of the period analyzed, whether political, social or cultural. Colin S. Gray reminds: “‘context, context, context’ decodes the origins, meaning, character and consequences of warfare”30. Although the offense-defence balance theory does not aim to link the domination of offense or defence during various historical periods with fundamental military change but, on the other side, it gives a perspective of interpretation of the influence of the fundamental military change on the international system based on the characteristics of the change that has occurred. In other words, if we recognize new possibilities provided by the military change after the Cold War to execute offensive operations, which cannot be stopped with the existing measures of defence, then we can assume that the state at the forefront of the military change will be more often determined to apply military measures when solving political problems, thus, it is likely that a greater tension and bigger conflicts will arise in the international system.

2. The impact of fundamental military change on the international system: the assessments of different historical periods

The impact of every fundamental military change on the international system is strongly dependent on the analyzed historical period. The context of the analyzed historical period (social and political) is often the determinant

30 Gray C.S., Another Bloody Century: Future Warfare, London: Phoenix, 2005, p. 55. 20

factor. It is possible to distinguish many historical periods during which the influence of the military change on the international system manifested itself in different forms, however, in order to define the impact of the fundamental military change on the international system two different historical periods with essentially different consequences of the impact of the military change may be distinguished, i.e., the pre-nuclear era and the nuclear era. The main criterion of such distinction is the consequence of the impact of the fundamental military change on the dominant states of the system (i.e., whether the dominant state(s) of the system face the real threat of extinction or not). Today it would be too early to claim that it is possible to distinguish the third period which followed the Cold War, because the military progress of this period has not yet provided states with unique military instruments that could be used for defeating the nuclear states during a military conflict and preventing the threat of becoming a target of a nuclear strike. Otherwise, this does not put obstacles for further research on the influence of military change on the international system after the Cold War. Taking into consideration the limited capacities of this paper to discuss various historical episodes from the pre-nuclear epoch in greater detail, two distinctive historical periods will be analyzed – the first part of the 15th century (the artillery revolution) and the 16th-17th centuries (the naval revolution which coincided with the mastering of firearms), which reveal the dilemma of survival in the international system due to the influence of the fundamental military change and the exclusive opportunities to transform the hierarchy of dominant states.

2.1. “To survive or to dominate”: the determinant role of the fundamental military change in the pre-nuclear era

2.1.1. The consequences of the artillery revolution

Until the period of 1400-1430, when interdependent military innovati- ons31 turned the field artillery into a threatening element of military power, cannons had been used for around hundred years in the wars of the medieval Europe but did not cause major military impact. Before the artillery revolution the medieval military fortifications32 were capable of withstanding long sieges. For example, the siege of Rouen during the Hundred Years’ War lasted from 31 July, 1418 until 19 January, 1419, however, although the Englishmen intensively used bombards, the city surrendered because of the long-lasting famine and not because of the damage caused by the artillery.33 The artillery revolution became

�� The newly invented cannons could bear bigger barrels (this increased the firepower, accuracy and speed); the cannon loading mechanism and powder formation was also improved. 32 They were vertical because the aim was to provide protection not from the artillery bombardments but from the storm of the enemy‘s live force. 33 Rogers C.J., „The Military Revolutions at the Hundred Years War“ in Rogers C.J., ed., The Military Revolution Debate: Readings on the Military Transformation of Early Modern Europe, Colorado: Westview Press, 1995, p. 6. 21 a really expensive military innovation: in 1442 the expenditures of the French king for the “artillery trains” were twice as high as for the traditional military means such as bows, arrows, and lances.34 This negatively affected the capacity of smaller states to defend against larger states: up until this revolution the military forces of minor states could safely retreat into the fortified cities and castles, although they were incapable of fighting with the significantly stronger enemy in the open battlefield. The artillery revolution ensured a determinant superiority for larger and financially stronger states against smaller ones. The collapse of Siena as an independent state in the 16th century after the French and Spanish invasions proved that the state was incapable of adjusting to the military changes caused by the artillery revolution. The success of France in winning back Normandy and Aquitaine in 1449-1453 and in pushing England out of France (the continent), thereby eliminating the most significant achievements of England in the Hundred Years’ War, is a direct consequence of the artillery revolution.35 The French rulers were not only able to change the course of the Hundred Years’ War with England, but also to speed up the centralization of the state (Burgundy and Brittany also soon fell under the control of the French king). Simultaneously, Spain also used the military instruments provided by the artillery revolution and in 1482-1492 it managed to significantly weaken the positions of the Moors in the kingdom of Granada. Besides, the artillery revolution also hastened the fall of Constantinople and the Byzantine Empire in 1453. The impact of the artillery revolution was tangible until around 1525, when the Italian states stopped36 the Habsburgian onslaught in Italy thanks to the new military innovations – a construction of so-called trace italienne – which could withstand massive bombardment of fortifications.37 The artillery revolution provided an opportunity to temporarily change the power relations in the medieval Europe (Italian states vs. France or Spain; France vs. England during the war on the continent) or even to ruin the states (Siena, the Byzantine Empire). This military innovation was obviously more favourable to larger states, and unbalanced relations among relatively weaker and stronger states were ‘reconstructed’ only during the next military innovation. Therefore it is possible to presume that the consequences of the artillery revolution for interstate relations and for the entire state system of the medieval Europe would have been even more obvious if the representatives of Italy and other states had not managed to invent and construct fortifications that were able to withstand artillery bombardments.

34 Ibid., p. 74. 35 Goldman E.O., Andres R.B., „Systemic Effects of Military Innovation and Diffusion“, Security Studies, Summer 1999, vol. 8, no. 4, p. 79-125, http://www.au.af.mil/au/awc/awcgate/innovation/jciss/syst.htm, 10 02 2009. 36 The state of Siena also planned to build the trace italienne, but did not have time to do it. 37 Leon Battista Alberti, Italian architect and humanist, is considered to be the author of the idea of trace italienne. 22 2.1.2. Combination of the firearms and naval revolutions: the preconditions of the early global domination of the West

The appearance of heavily-armoured sailing ships in the period of 1450- 1650 radically transformed the then global situation. Until the first half of the 15th century galleys driven by oars dominated in the European waters (the Mediterranean Sea, the seas bordering the Western coasts of France, Spain and Portugal, the shores of England and the Netherlands). However, around the middle of the 15th century the oar-driven galleys were challenged by galleasses (the ships heavier than galleys with cannons fixed in the decks) and galleons (the ships driven by sails) armoured with cannons (fixed below the boat deck level). The appearance of heavy ships was mainly due to the artillery revolution that helped greatly increase the firepower and accuracy of cannons. The European powers (Spain, Portugal, England, the Netherlands, France, and Venice), which competed for domination in Europe and which aimed to control the global sea trading routes, quickly learned how to master these changes. This revolution was particularly painful for the Ottoman Empire which had until then dominated in the Mediterranean Sea, and whose navy of galleys was defeated by the Venetian galleasses in the battle of Lepant in 1571. The victory of the English navy against the Spanish Armada in 1588 marked another stage of the naval revolution, during which cannons capable of producing constant firepower were introduced. Just a few warships of the Spanish Armada were capable of keeping constant cannonade during the battle, and that determined the final victory of the English Navy.38 The frigate, which was constructed by the Dutch in the first half of the 17th century and which could be ideally used for long distance voyages and battles, is considered to mark yet another stage of the naval revolution.39 Such competition among the European powers, which were able to quickly adapt to each other’s military innovations, did not ensure absolute superiority to any of them in the short-term struggle against one another. However, the above mentioned military innovations together with the tactical revolution, defined by Michael Roberts during the 16th century, provided Europe with exclusive military superiority against the civilizations of American40 and African continents, the populations of India and South Asia. Heavy marine vessels enabled the Western Europeans to conquer sea-trading routes in the Atlantic and Indian Oceans and also to project their power on land. The Europeans seized the main seaports and sea-trading routes, and they also managed to prevent the local states from challenging their domination in the coastal territories. Only the Far Eastern states (China and Japan) could seriously resist the Western European invasion into their territories, where Europeans established themselves only after the Industrial Revolution.

�� Parker G., The Military Revolution: Military Innovation and the rise of the West, 1500-1800, Cambridge: Cambridge University Press, 1999, p. 95. 39 Ibid., p. 99. 40 The classical example would be the victories of Cortés over the Aztec Empire in 1519-1521. 23

Taking into consideration the impact of these military innovations, it is possible to state that in the Western Europe these innovations were influenced by (emerged because of) the competition of the states, while aiming to control the sea-trading routes and while seeking to gain an overall superiority of power against the nearest rivals. However, on the other hand it is impossible to forget that the latter military innovations did not directly result from the competition among the rival states. The appearance of Venetian galleasses is linked with the intention of the Venetian rulers to protect their merchant navy from frequent pirate attacks in the Mediterranean Sea, but not with the power to compete against the Ottoman Empire or the European power.41 It is also important to mention that due to the navigation peculiarities at the Mediterranean Sea the galleys did not lose their significance at this sea until the 18th century, but from the military point of view they were worthless in the open oceans. Nonetheless, the significance of the naval innovations of the 16th-17th centuries was that they enabled Western Europeans to conquer the global sea-trading routes and established conditions to expand the Western domination over other civilizations in the 19th century.

2.2. Military innovations during the Cold War: formation and maintenance of fragile strategic stability

There are different opinions in the academic circles regarding the number of revolutions in military affairs that took place during the Cold War. However, there seems to be more consensus regarding the nuclear and aircraft carrier revolutions.42 The invention of the nuclear weapon and later the test of the hydrogen bomb in 1952 created an entirely new warfare dimension among the states. Meanwhile, the appearance of the aircraft carriers changed the face of the conventional war at sea. The nuclear revolution essentially changed the logic of the confrontation among the most powerful military states. Until the appearance of the nuclear weapon, the dominant military powers, which conflicted among themselves, could try to solve their discords in the battlefield. The appearance of the arsenal of nuclear and hydrogen bombs in the armoury of the US and the USSR, however, had de facto constrained the intention to escalate the mutual conflict.

41 Parker G., The Military Revolution: Military Innovation and the rise of the West, 1500-1800, Cambridge: Cambridge University Press, 1999, p. 87. 42 The proponents of the revolution in military affairs caused by aircraft carriers state that the war of aircraft carriers created a new operational and tactical level of war at sea; moreover, the accurate fire of warship fleets became unimportant. (Hundley R. O.,Past Revolutions. Future Transformations. What can the history of revolution in military affairs tell us about transforming the U.S. military?, National Defence Research Institute, RAND, 1999, http://www.rand.org/pubs/monograph_reports/2007/MR1029.pdf, 15 09 2008). On different opinions regarding military revolutions during the Cold War, see: Bernard S., “The Revolution in Military Affairs: The Approach with Caution”, The Army Doctrine and Training Bulletin, Winter 2000/ Spring 2001, Vol.3, No. 4/ Volume 4, No.1, p. 60. 24

Nevertheless, this conclusion, which is often repeated as a widely accepted truth, became a matter of fact only around 1972. Until then the confronting superpowers – the US and the USSR – felt vulnerable because of the continuous process to achieve a first nuclear strike advantage. Lawrence Freedman notes that in the late 1950s there was a belief that the rapid technological progress will be by itself destabilizing.43 It was assumed that the rapid technological leap could provide one of the confronting sides with the first strike advantage, which would deny the enemy to respond with a nuclear strike, too. The construction of intercontinental missiles capable of carrying nuclear warheads or the defence build up against long-range bombers were perceived as strengthening the first nuclear strike advantage. In the middle of the 1960s, after the Cuban crisis, both the US and the USSR understood that neither of them had significant superiority in case of a nuclear conflict, but academics estimated that such a perception may be affected by the creation of an effective anti-missile defence system.44 The then US secretary of Defence Robert McNamara raised this question in the conversations with the Prime Minister of the USSR Alexander Kosygin (in 1967), but at that time the USSR government rejected the US proposal to stop the development of the anti-missile defence system, claiming that this measure could strengthen the defensive power.45 However, the Soviet Union soon recognized a potentially destabilizing effect of the anti-missile defence system to strategic stability and thus in 1972 the USSR together with the US signed a treaty, which limited the development of anti-missile defence system and their components. Although the strategic stability was maintained thanks to this agreement, soon this stability was repeatedly threatened as the relations between the US and the USSR worsened after the USSR invasion to Afghanistan and the dislocation of the US short-range and medium-range missiles in Western Europe in the early 1980s. In the course of such events, the US declared the Strategic Defence Initiative, the implementation of which would have been resulted with the creation of the modern anti-ballistic missile system. Even though the goals of the Strategic De- fence Initiative were not achieved, the Soviet Union in response to this initiative spared a lot of time constructing symmetrical and asymmetrical measures. The creation of aircraft carriers and the formation of carrier battle groups, which was considered as the fundamental military change, were not as significant as the aspiration of the US and the USSR to gain superiority in mutual confrontation while developing nuclear weapons as well as their launch and protection means. Nevertheless, the Soviet Union regarded the US

�� Freedman L., “The First Two Generations of Nuclear Strategists” in Paret P., ed., Makers of Modern Strategy from Machiavelli to the Nuclear Age, Princeton: Princeton University Press, 1986, p. 755. 44 For estimations of Herbert York and Jerome Wiesner, see: Freedman L., “The First Two Generations of Nuclear Strategists” in Paret P., ed., Makers of Modern Strategy from Machiavelli to the Nuclear Age, Princeton: Princeton University Press, 1986, p. 757. 45 Kokoshin A.A., Nuclear Conflict in the Twenty-First Century, BCSIA Discussion Paper 2007-03, Kennedy School of Government, Harvard University, April 2007, http://belfercenter.ksg.harvard.edu/files/ kokoshin_2007_03.pdf, 20 10 2008. 25 carrier battle groups as a military measure of a huge threat and thus developed responsive measures in order to neutralize this threat. In the beginning, the Soviets planned to use the swarming attacks by bombers launching anti-ship missiles at long range. In response the US constructed and implemented the Aegis system. Soviets reacted to this military innovation by creating a Sunborn missile, capable of very-low-level supersonic flight.46 In order to estimate the significance of the nuclear revolution in regards to international relations, it is important to note several aspects. This military innovation for the first time in history has limited the intention of the confronting states of the system to solve conflicts by military measures, because of the threat of mutual annihilation. However, the real effect of such limitation (strategic stability) was continuously tested by new military innovations that could give one or the other side assurance of its superiority in case of a nuclear war. The impact of the formation of carrier groups should probably be regarded as a temporal increase of tension between the US and the USSR which did not make a significant impact.

2.3. US military transformation after the Cold War: implications to strategic stability of international system

The influence of military change on international relations after the Cold war can be assessed based on the conditional distinction of two periods. During the first period (till the escalation of conflicts in Iraq and Afghanistan in years 2005-2006) a belief in military progress was dominant among the US leaders. Then followed a period marked with the increasing doubts on the revolution in military affairs phenomenon after the Cold war, and the possible imaginable advantages for the Americans themselves. The beginning of the first period is associated with the successful US-led military operation against Iraq in 1991. The first expanded use of the PGMs47, the JSTARS48 and the satellite-based GPS in this operation stimulated the Pentagon analysts49 to proclaim the contemporary revolution in military affairs. Some US military officers were so convinced by the power of the PGMs that they started to question the utility of land forces in the Iraq war, and potentially in future conflicts as well.50 Radical proponents of contemporary revolution in military affairs, such as US admiral William Owen, forecasted future American military superiority, which will rely on the “system of systems” to be created

46 Alach Z. J., Slowing Military Change, Strategic Studies Institute, October 2008, p. 25-28, http://www. strategicstudiesinstitute.army.mil/pdffiles/pub878.pdf, 03 04 2009. 47 PGMs amounted only to about 10 percent of the weapons used in this military operation. Benbow T., The Magic Bullet: Understanding the Revolution in Military Affairs, London: Brassey‘s, 2004, p. 71. 48 Joint Surveillance and Targer Attack Radar System 49 Analysts at the Office of Net Assessments in the Defence Department, led by Andrew Marshall. 50 Benbow T., The Magic Bullet: Understanding the ‚Revolution in Military Affairs, London: Brassey‘s, 2004, p. 66. 26

with the support of the newest information technologies.51 Such a revolution in military affairs will make US Armed Forces undefeatable in the typical conventional military conflict.52 Proponents of the revolution in military affairs were convinced that achieved military progress in the end of the day will even deny fundamental “fog of war” thesis developed by Carl von Clausewitz. US Armed Forces Joint Vision 2010, released in 1996, reflected approach of the proponents of the revolution in military affairs, which indicated the US dominance in all possible types of conflicts due to the information technologies.53 Initiated military transformation of the Americans was targeted not just to enhance the PGMs capabilities (basically related with the Air Force) but to expand potential of the Land Forces to execute successful operations (for example projects The Army After Next, Future Combat System). Although in 1999, the US made some corrections in the military transformation project (not only the “digitization” of the Armed Forces but expansion of the deployability capabilities of the Land Forces54) the main assumptions of the military transformation were to stay in power. New US president G. W. Bush and his defence secretary D. Rumsfeld were firm supporters of the US military transformation programme based on the revolution in military affairs ideas. G. W. Bush and D. Rumsfeld in their military transformation vision saw U.S. Armed Forces to be rapidly deployable, reaching the furthest distances and defeating opponents exactly there.55 Accordingly the US defence planning process was reoriented along the lines of the this vision: the threat based defence planning process was replaced by the capabilities based defence planning, which seemed to enable for a preparation to counter any possible threat. However, the course of the conflicts in Iraq and Afghanistan signalled to US political leaders the limits of the mobile and deployable Armed Forces, even if built on the newest information technologies. It is acknowledged that the transformation of the US conventional military forces has been one of the key success factors for the military operations in Iraq and Afghanistan. US Special and the Air Force, enabled by the information technologies could act in such a coordinative manner, which was never seen before. During the Operation

51 Systems: 1) sensors; 2) command and control based on the advanced computer technologies; 3) know- how of the exploitation of information Žr. Benbow T., The Magic Bullet: Understanding the ‚Revolution in Military Affairs, London: Brassey‘s, 2004, p. 80-81; Kagan F.W., Finding the Target: The Transformation of American Military Policy, New York, London: Encounter Books, 2006, p. 217. 52 Conventional conflict is a conflict where nuclear weapons are not used and where no one party in the conflict doesn‘t rely only on the partisan war methods and techniques. 53 Joint Vision 2010 indicates: “[…] Long-range precision capability, combined with a wide range of delivery systems, is emerging as a key factor in future warfare [..]“ Joint Vision 2010, Office of the Joint Chiefs of Staff, 1996 http://www.dtic.mil/jv2010/jv2010.pdf, 20 05 2009. 54 Programme of the U.S. Chief of Joint Staff gen. Eric Shinseki. 55 Rumsfeld D., 21st Century Transformation, National Defence University, Fort McNair, Washington, D.C., Thursday, January 31, 2002, http://www.defenselink.mil/speeches/speech.aspx?speechid=183, 10 02 2009. Donald Rumsfeld conception indicates that US major forces have to be capable for deployment to a distant theatre in 10 days, defeat the enemy within 30 days and then be ready for redeployment somewhere else within another 30 days. Hawkins W. R., Is Rumsfeld’s “Revolution in Military Affairs” Finally Over?, http://www.americaneconomicalert.org/view_art.asp?Prod_ID=2548, 10 02 2009. 27

Iraqi Freedom US military could find the target and launch the PGMs in ten minutes, while during the Operation Desert Storm such action could last up to three days.56 However, a hardly fought insurgency in Iraq and Afghanistan by America stimulated a different view on the results of the military transformation, which recognized the limits of transformed conventional forces to fight the dispersed enemy who is not fighting America like the regimes of Saddam Hussein or Taliban did. It is obvious that the US political and military leadership, when planning military operation against Iraq in 2003, was expecting that the conventional offensive with a capture of Baghdad at the end, would be the decisive factor for the success. However, the insurgency led by the Sunnis in April-May of 2003 in Iraq proved that the conventional military superiority is not the strategic political pre-eminence. Afghanistan conflict also showed that the overthrow of the Taliban regime gives no guarantee for the victory against the Al-Qaeda and its supporters. Insurgency in Iraq and Afghanistan convinced US leaders (President G. W. Bush in his second term and new President B. Obama) about the limits of military decisions (even if backed by the most modern military forces) to broker political stalemates: the changed US strategy in Iraq in 2006/2007, the new Afghanistan-Pakistan strategy announced by the US President B. Obama devoted more attention to political instruments. But the US military capabilities development process is not blindly resting on the President G. W. Bush‘s vision anymore. Balanced strategy declared by the US defence secretary Robert M. Gates exactly points an overwhelming need to balance the demands to win the current wars and be prepared for the future conflicts. In addition this strategy foresees to balance the institutionalization of counterinsurgency capabilities and to maintain the United States’ existing conventional and strategic technological edge against other military forces.57 However, it is evident that the Balanced strategy of defence secretary Robert M. Gates continues to stress the fundamental need to maintain military superiority against anyone, which was so typical in the rhetoric of the former US President G. W. Bush. It seems that the military transformation may further act as a strong motivation for the US leaders to rely primarily on the military instruments when solving the conflicts. The direct impact of the US military transformation for the other actors in the international system is a different one. US allies (for example NATO members and Australia) try to adapt some of the US military transformation elements as to stay (operationally) relevant in the upcoming possible joint

56 Boot M., War Made New: Weapons, Warriors, and the Making of the Modern World, New York: Gotham Books, 2006, p. 355-357, 397. Also look at Biddle S., Embrey J., Filiberti E., Kider S., Metz S., Oelrich I. C., Shelton R., Toppling Saddam: Iraq and American Military Transformation, April 2004, http://www.fas. org/man/eprint/biddle.pdf, 10 02 2009. 57 Gates R. M., “A Balanced Strategy: Reprogramming the Pentagon for a New Age”, Foreign Affairs, Janu- ary/February 2009, p. 28–40. Also look at the Statement of General James N. Mattis, USMC Commander, United States Joint Force Command, House Armed Services Committee, March 18, 2009, http://www.jfcom. mil/newslink/storyarchive/2009/sp031809.html, 10 08 2009. 28

military operations with the US Armed Forces.58 However, the attitudes and reactions of the People’s Republic of China and Russia (potential US opponents) to the US military transformation are differing. The People’s Republic of China is concerned more about the influence of the US military transformation process to its goal reintegrate Taiwan, if needed by force.59 Meanwhile Russia gives priority to maintain the capability for nuclear strikes considering the increased power of US conventional forces at the outcome of the military transformation process.60 It seems that the US military transformation is pushing Iran to acquire the nuclear strike capabilities too. There are several important aspects to be drawn from the generalized assessment on the impact of the US military transformation to the contemporary international relations. Firstly, the military transformation encouraged the US leaders to rely more on the military power in the international relations. The importance of the military capabilities when solving strategic political problems was too much exaggerated. Secondly, the assumption supposing that the US military transformation acts as a trigger for other states to initiate and pursue their nuclear weapons programmes seems to gain more credibility. For such states as Iran the acquisition of nuclear weapon will give more sense of security vis-a-vis US than the mere modernization of conventional forces. Thirdly, the spread of the newest military technologies around the world (which are the core of US conventional military strength) weakens the US military superiority against the potential opponents. Andrew Krepinevich is certain that the US military domination is diminishing basically because of the loosing monopoly on the production of the precision-guided munitions.61 This trend may encourage the potential US opponents to test the US military power more often than in the past, which may result in the increasing instability and tension in the international system.

58 Evans M., Australia and the Revolution in Military Affairs, Land Warfare Studies Centre: Working Paper 115, August 2001, http://www.defence.gov.au/army/LWSC/docs/wp%20115.pdf, 20 09 2008; Donnelly C., How Do Allies Deal With U.S. Military Transformation, NIDS Symposium on the International Security 2006. Military Transformation in the 21st Century: Challenges for New Security Environment, http://www. nids.go.jp/english/dissemination/other/symposium/2006pdf/e2005_06.pdf, 20 09 2008; Sloan E., “Canada and the Revolution in Military Affairs: Current Response and Future Opportunities”, Canadian Military Journal, Autumn 2000, http://www.journal.forces.gc.ca/vo1/no3/doc/7-14-eng.pdf, 20 09 2008; Sloan E., Military Transformation and Modern Warfare: A Reference Handbook, Westport, Connecticut, London: Praeger Security International, 2008. 59 Mulvenon J. C., Tanner M. S., Chase M. S., Frelinger D., Gompert D. C., Libicki M. C., Pollpeter K. L., Chinese Responses to U.S. Military Transformation and Implications for the Department of Defense. RAND, 2006, http://www.rand.org/pubs/monographs/2006/RAND_MG340.pdf, 20 07 2009. �� Sloan E., Military Transformation and Modern Warfare: A Reference Handbook, Westport, Connecticut, London: Praeger Security International, 2008, p. 109–121. 61 Krepinevich A. F., “The Pentagon’s Wasting Assets: The Eroding Foundations of American Power”, Foreign Affairs, July/August 2009, Vol. 88, No. 4, p. 18–33. 29 Conclusions

Analysis of the military change impact on international system presents one additional perspective to look at the processes in the international relations. However, such insights are directly dependent upon the solution of important methodological question – how to define the military change when we are looking for the precise and valid evaluation of its impact on international relations. So the construction of the fundamental military change concept is the main methodological point of departure, which helps to identify the research framework for the interactions between military change and international system analysis. The sceptics of such research should be aware of argument that this particular analysis is not inclined to evaluate the impact of all new and continuously discovered means of warfare on the international system if those do not change the dominant means and patterns of warfare. Unfortuna- tely, it must be pointed out that the explanatory power of the offense-defence balance theory is suffering exactly because the used military change concept lacks clarity. On the other hand, the offense-defence balance theory is perfect in explaining the basic logic of the military change impact to international relations, which is valid in the analysis of different historical periods, and which can be adapted for contemporary international relations. The analysis of three different historical periods (the Middle Ages and Modern Times, Cold War era, post-Cold War era) showed the possibility to identify the impact of fundamental military change, although the extent and results of such an impact are uneven. It must be pointed out that only the analyzed artillery, firearms, naval and nuclear revolutions can be labelled as the fundamental military change. The argument that the military change after the Cold War is a fundamental one becomes more and more loosely grounded. However, it is still too early to completely judge the military change after the Cold War: fundamental military changes are generally extended over a much longer period than the twenty year period that has passed since the end of Cold War. However, this is not an obstacle to assess the impact of military change (which nevertheless may still turn into a fundamental one) to contemporary international relations. The logic of the impact of fundamental military during the Middle Ages and Modern times to the interstate relations is simple: a state, which was not capable to follow after the fundamental military change, faced a threat of extinction from the political map. During the Cold War era the nuclear weapon became a balancing factor of the international system, especially when monopoly of nuclear weapons was divided between two camps, the Soviet and the American. However, it is true some time was needed as both camps recognized the potential of the other side to initiate the first and the second nuclear strikes. US military transformation after the Cold War became a factor, which destabilizes contemporary international relations. It is mainly because of the 30

increased US reliance on the conventional military capabilities when solving strategic political problems such as a change of the Iraqi regime. In addition, the US military transformation even more encouraged hostiles towards the US states to acquire nuclear weapon, which might deter US conventional onslaught. Information technologies – the engine of the US military transformation, became widely used by other states and the terrorist groups (such as Al-Qaeda), making the US more vulnerable. Consequently, the hostiles towards the US actors are ready to exploit the emerging US weaknesses, and that in effect increase instability of the whole international system. Excursuses into the historical periods (the Middle Ages and Modern times; the Cold War period), explaining the interaction between military change and international system, and analysis of the impact of US military transformation to contemporary international relations and the interpretations of such interactions show the importance of further studies in this field. It is even more relevant while still the military superiority is held one of the most reliable instruments to ensure national security.

Vilnius, April-September 2009 31

Kęstutis Paulauskas* Institute of International Relations and Political Science, University of Vilnius

NATO at 60: Lost in Transformation**

This article discusses NATO‘s evolution and prospects of its future developments. The article addresses internal tensions and dilemmas the Alliance‘s members may have to confront and overcome. The author contends that the process of preparation of the new strategic concept may have signaled a certain ideational crisis of NATO and its search for a new identity. NATO‘s “transformation” increasingly resembles an aimless process rather than a clear and to all allies unanimously acceptable raison d‘etre. Robert Cooper‘s thesis of the international system consisting of pre-modern, modern and post-modern states is applied to explain NATO‘s problem of the strategic dissonance. Postmodern societies of the allies are increasingly less inclined to support military adventures beyond NATO‘s territory. NATO‘s operations often take place in pre-modern, anarchical environment of failed or failing states. Such missions require advanced technologies and a comprehensive, integrated civil-military approach. Many countries outside Europe and North America are 20th century-type modern nation-states, often undemocratic, like China and Russia. The latter country remains an important factor defining Alliance‘s identity within and in the international system. NATO, which seeks to become a progressive, forward looking Alliance of the 21st century, struggles to develop a dialogue with Russia on the most pertinent security problems in the post-sovereign and post-national European space. The new strategic concept will have to encompass all these apparently irreconcilable, “dissonant” elements. NATO no longer is a solely regional military block nor is it becoming a global political forum, which would be addressing all the most important international security problems. NATO is preparing to undertake both “most likely” operations, such as in Afghanistan and the most demanding, article 5 operations. It is possible that by focusing on light, expeditionary forces to be used in wars against asymmetrical, weak enemies the ability of the allies to wage conventional wars against near-peers will degrade. Russian war on Georgia has recently reminded that such wars in Europe are still likely. Lithuania‘s experience of NATO membership is mixed: some expectations were fulfilled, and some – not, but Lithuania has come a long way in seeking to become a more mature ally.

Introduction

NATO comes in many different guises – from the symbol of the triumph and glory of the Western community of democracies to an aggressive, expan- sionist military block with nefarious designs on other countries. In the official Western narrative, NATO is the greatest and most successful military Alliance in (Western) history. NATO has outlasted the Warsaw Pact in the Cold War stand-off, NATO has pacified the Balkans and now is

* Dr. Kęstutis Paulauskas is a lecturer of the Institute of International Relations and Political Science of the University of Vilnius. In 2006-2009 he served as a Deputy Defence Advisor at the Lithuanian Delegation to NATO. Address for correspondence: Vokiečių 10, LT-01130 Vilnius, Lithuania, tel.: + 370-5- 2514130, e-mail: [email protected]. ** Author thanks David Yost, Vaidotas Urbelis and Tomas Janeliūnas for valuable comments on earlier version of this article. 32

bringing democracy and stability to the war-torn Afghanistan, as well as fighting pirates off Somali coast. For a dozen Southern and Central European countries that emerged from the ruins of the communist dystopia, NATO is a dream-come-true of a secure and prosperous future, as well as an ultimate hedge against any possible revisionism of the post-Cold War borders in Europe. For a number of countries in the Balkans and Eastern Europe, it is an object of a similar aspiration and expectation (in some cases – a rather distant one). For the Western European Allies, NATO has probably lost the existential appeal that it used to enjoy during the Cold War. For some, the Alliance has even become somewhat of a hurdle on the way of development of an autonomous European Security and Defence Policy. The NATO – EU relations are still locked in a “frozen conflict”1, an especially embarrassing feat for the 21 nations that are members of both. For the Anglo-Saxon Allies – the United States and the United Kingdom, NATO serves as an extension of their global interests and ambitions (in the case of UK – those of the past). The concerns that the United States views NATO as a mere “toolbox” for its global adventures may have been exaggerated, but the waning commitment to NATO of some of the European Allies, can eventually be reciprocated by the policy makers in Washing D. C., to the detriment of European security. Of course, there are also those who despise NATO, inside and outside the Alliance’s borders. First, there is the “new enemy” - the “opposing forces” in Afghanistan. For the Taliban and Al Qaeda NATO is quite simply an evil spawn of the rotten, infidel West. As for the “old enemy”, NATO still plays a crucial role in Russia’s strategic thinking. Russia’s new strategic concept still considers NATO activities as threatening its security. Paradoxically, NATO’s continued existence is probably more important for Moscow than for some of the Allies – “NATO” comes in as a handy tool that helps mobilize the discontented public in the face of an encroaching external enemy, an aggressive military Alliance, lurking at the borders to invade the Motherland. Last but not least, there are the affluent Western European societies, which have long forgotten the horror of the world wars, and do not want to put their young men and women in harms way. The organized segments of those societies – various anti-war, anti-globalisation, anti-everything movements – view NATO as a warmongering club of bloodthirsty generals that has to be disbanded immediately. Most of these images and stereotypes are no doubt exaggerated, over simplistic and, ultimately, misleading. However, the share volume of different images indicates that NATO still remains a very important organisation with a global clout of appeal, recognition or despise. Within such a context, this

1 Former NATO Secretary General Jaap de Hoop Scheffer used this label in a speech “NATO and the EU: Time for a New Chapter”, on 29 Jan 2007. 33 article tries to decipher what NATO is, what it is not and what it could be in the tumultuous beginning of the new millennium, as seen through (and cave- ated by) the perspective of an academic from a relatively new and a relatively small Ally. This paper puts forward three interrelated propositions: • NATO is (literally) an elderly Alliance, which is constantly trying to change and adapt to the rapidly evolving global environment. Howe- ver, a clear purpose of NATO’s existence may have been lost in the process of “continuous transformation”. • Although NATO undertakes ever more new missions, activities and partnerships, its political role has deflated over the past two decades because military power (albeit still important) is no longer the central element of international politics. Hence, NATO’s urge to once again redefine its purpose. • As a result, NATO is undergoing a sort of an identity crisis: complex dilemmas will have to be addressed and, in some cases, hard choices will have to be made. The paper concludes with a chapter on the 5 years of membership experience of the 7 Allies that joined NATO in 2004. In this context, the key lesson is this: the trial phase is over. It is up to each Ally and its representatives in Brussels to work hard, fight for the agenda setting and, ultimately, die in the ditches for the interests that the given capital considers of national importance.

1. The bloom and gloom of 60th anniversary

NATO, as a military alliance, is an agile organization. It has outlasted the Warsaw Pact in a 40-year long brinkmanship. It has survived the calls for its disbandment after the end of the Cold War. The Alliance has re-invented itself already twice by adopting a future-oriented Strategic Concept in 1991 and reviewing it in 1999 to reflect the lessons of the Balkan wars and prepare for the next century. In April 2009, NATO, 28-strong political and military Alliance, has celebrated its 60th anniversary in Strasbourg/Kehl – a symbolic place of Franco-German rivalry and reconciliation. NATO at 60, however, seems to be short of ideas and suffer chronically from a case of strategic dissonance.

1.1. A crisis of ideas?

The festive mood of that summit has long subsided. NATO is facing a number of seemingly intractable issues. Some of them have always been there (e.g. the Soviet Union during the first 40 years, replaced by the cumbersome relationship with Russia during the latter 20), and some of them have been 34

dictated by events: the Balkan wars during the 90s (NATO still finds itself in Kosovo); the 9/11 attacks on the US, which led to the ongoing war in Afghanis- tan; and the outburst of piracy off the coast of Horn of Africa, which constitutes the most recent addition to NATO’s agenda. Ever new challenges and ever more fluid global security environment prompted the Alliance to undertake a new revision of its overall strategy. The Allies seem to be struggling to define the 21st century NATO and to agree its ultimate raison d’etre. The drafting process was entrusted to a group of twelve “wise men” headed by an even wiser woman Madeleine Albright, rather than the senior NATO committees which usually draft all key NATO documents – the Senior Political Committee, the Executive Working Group or the Military Committee. The drafting exercise was undertaken in an unprecedentedly transparent and all-inclusive way. It was launched on 7th of July 2009 in a major conference in Brussels, attended by an eclectic gathering of “a broad range of representatives from Allied and Partner governments, NATO structures, international organizations, civil society, including parliaments, the corporate sector, NGOs, think tanks, academia and the media”2. This opening round was to be followed by a number of quasi-academic seminars, addressing various aspects of the concept. The effort to solicit a broad range of views on NATO’s strategic direction has clearly showcased what NATO no longer is - a closed, secretive military alliance. At the same, it might mean that the Allies are no longer certain about NATO’s purpose and role in the global politics and are incapable of defining the future of NATO on their own. Albright’s “inauguration” speech in the opening conference said all the right things to all the interested audiences.3 However, being nice to everyone does not necessarily make for a sound strategy. One may wonder whether the Alliance’s commendable exercise in transparency is masking the fact that the Allied leadership is running out of inspiring ideas that could capture the attention of the “google” generation. The first NATO secretary general Lord Ismay has famously described NATO’s purpose as that of “keeping the Russians out, the Americans in, and the Germans down” – a phrase that sustained the strategic imagination of an entire generation. 09’ NATO is, of course, quite different from the 49’ NATO. Today, it is unimaginable that a secretary general of the new NATO could suggest such a catchy but politically sensitive or even incorrect slogan. A refreshing ignorance of politically incorrect language would probably prompt at something like “getting the Russians in, the Germans up and the American out” to describe the current state of affairs. Indeed, since the end of the Cold War, Germany has re-united, the American’s have closed down most of their military installations

2 NATO launches public debate on the Strategic Concept, 7 July 2009, available online: http://www.nato. int/cps/en/natolive/news_56326.htm?, 2009-11-28 3 Albright M., “NATO 2009: Past Lessons, Future Prospects”, http://www.nato.int/cps/en/natolive/opin- ions_56158.htm, 2009-11-29. 35 and withdrew most of their troops from Europe, and Russia has become a full- time player in Euroatlantic security affairs. Lord George Robertson (NATO secretary general from 1999-2004) had offered another widely overused slogan for NATO’s future destiny: NATO had to “go out of area or out of business”. Today, however, some analysts quip that after going out of area to Afghanistan, NATO might be dangerously close to going out of business.4 NATO is quite clearly suffering from a communication problem. NATO is not a prominent fixture in the Western news media. Probably the most visible aspect of NATO is its operation in Afghanistan. NATO usually gets credit for being a complementary, if not always forthcoming and helpful part of the American effort to stabilize and reconstruct the country. The spotlight is often quite negative: unwillingness of European Allies to apply lethal force and reluctance to contribute some advanced (and pricey) capabilities, like helicopters are emphasized. When the Allies do apply the air power, the media trump up civilian casualties. Being “out of area” also means being “out of sight” for the general public, especially in the case of smaller Allies that do not host global TV networks. CNN or BBC do not broadcast the daily lifes and adventures of Czech or Lithuanian troops in Afghanistan. And even if they did, most Lithuanians would not watch it anyway. Basically, it is an unwinnable uphill battle for “hearts and minds” at home, not only in the areas of operations. The only other element that gives NATO some regular publicity (for better or worse) is Russia’s loathing of the Alliance for its conspiratory encroaching upon Russia’s self-delineated sphere of legitimate interests. It is no doubt that NATO’s public face and make-up is changing. With addition of 12 East-Central and Southern European countries NATO has become a more diverse and, quite literally, more youthful organization (most Ambassadors from the newer Allies at the North Atlantic Council tend to be younger than their Western counterparts). A new generation of leaders is emerging with little memory of the darkest Cold War days. Barrack Obama was still a student and a “community organizer” and Nicolas Sarkozy and Angela Merkel were just starting their political careers in the 1980s, when the Cold War started to unravel. They matured into statesmen and leaders during the years when history was put on hold to reap the peace dividends. Their background no doubt shaped their political views, instilling them with the values of pragmatism, openness, dialogue and cooperation rather than ideology, isolation, confrontation and paranoia of the Cold war era. The results of this change are already evident and France’s return to NATO’s integrated military structure after 40 years of absence tops the list. At the same time, the North Atlantic Council still remains an exclusive club of elderly, white, graying, upper-class male statesmen. Females and non-Caucasian males are a extreme rarity in this circle (to say nothing about

4 See, for example: Patrick S.M., “Out of Area, Out of Business?”, National Interest Online, 25 March 2009. 36

the top job of the Secretary General). One could argue that on a very basic, anthropological level, this subjective fact does limit the worldview of this body at a time when the nature of the global politics is in a constant flux. In broader theoretical terms, NATO could still be described as a very state-centric organization, which functions on the basis of such classical notions as territory, sovereignty and military power. In that sense, it is still an organization of the 20th century geopolitics. The Afghanistan experience is no doubt changing that reality, albeit slowly. Rapid advances of technology and uncontrolled forces of globalization are giving rise to mobile, politically conscious and assertive global community which is transcending the state-centric politics. Sooner rather than later the Allies will have to grasp this new reality. A simple comparison of NATO’s logo for the 60th anniversary with the logo of the Russian Federation Mission to NATO should amplify the case for this apparent crisis of ideas.

Figure 1. NATO’s crisis of ideas

NATO seems to be lost in transformation, while the symbology of its Russian partner radiates full confidence and control of its goals and policies.

1.2. Strategic dissonance

One could argue that NATO is struggling with a strategic dissonance (see Figure 1), which emanates from the confluence of what Robert Cooper calls pre-modern, modern, and postmodern states.5 Most Allied nations could be considered “postmodern” societies, which are affluent, secular and emancipated. Borders, national sovereignty, military power are no longer the defining elements of the domestic political discourse, especially in Western Europe, but increasingly elsewhere too. People are more preoccupied with the prosperity of their households and security on the stre-

5 See: Cooper R., The Post-modern state and the World Order, London, Demos, 1996. 37 ets of their hometowns rather than the number of tanks or nuclear missiles in the possession of a hostile superpower, as was the case during the Cold War. These are post-national, post-sovereign and post-territorial communities, for whom the concepts of “national borders” and “national interest” are becoming obscure memories of the past.

Figure 2. NATO and the strategic dissonance.

However, this is not the case in many modern nation states, starting with the “BRIC” countries and, indeed, most of the world outside Europe and North America. This is the world in which the rules of 20th and even 19th century still apply: a centralized national state, usually built around one main ethnicity, is the central element of life for the citizenry. In the domestic politics, citizens are subdued and serve the state objectives. State interest is far above that of an individual interest. In international affairs, the security dilemma dictates the logic of zero-sum game and perpetual search for balance of power. Finally, there are spots of pre-modern spaces on the world map, mostly in places where the project of national statehood has failed soon after the end of the colonial era. The central government is either very weak or non-existent altogether. Domestic politics are organized around warring factions and/or tribes. Human dignity and life has little value, to say nothing about basic human rights. Today, the most extreme such example is Somalia, but Afghanistan with its tribal approach to politics and almost genetic immunity to Western-style democracy could also be considered a pre-modern space. The encounters among postmodern communities and modern nation states produce misperceptions and miscommunication akin to the one constantly re-occurring between, for example, NATO and Russia, EU and Russia or EU and China. The starting point for these encounters could hardly be more disparate for the sides involved. Countries like Russia and China pursue vigo- rously “national interests” as defined by the political elites whose accountability to their publics is limited to maintaining minimal living standard. Any public 38

quest for alternative arrangements is pretty much outlawed. The key “national” interest for these elites is the survival of the ruling regime by any means necessary. The central premise of action for the North American and European decision makers is democratic legitimacy and public good, for only this premise can help their re-election. This is distinction is of paramount significance and cannot be merely glossed over by the rhetoric of “mutual interest” – while both sides can be interested in the same object, issue or problem, the nature of the interest itself will be inherently different. Engagements in pre-modern space by Western states present a different kind of challenge. When national defence matters have descended way down on the list of national priorities in most Western countries after the end of the Cold War, political, military and industrial elites came up with the idea of RMA – Re- volution in Military Affairs. The RMA promised a heave reliance on advanced technology in the modern battlefields, making human casualties much rarer than during the bloody conventional wars of the 20th century. NATO on its own part responded with the idea of defence “transformation”, which meant the shift from armour-heavy, territorially organized conscript armies towards much lighter, mobile, well-equipped and deployable professional units, fit for expeditionary operations far beyond Alliance’s border. The only problem with this entire endeavor was the public buy-in. The 9/11 provided the necessary legitimacy and rationale for the international operation in Afghanistan. 8 years later, however, Western societies are growing increasingly intolerant to the rising number of casualties, ignorant about the causes of the Allied presence in Afghanistan, or other such places, and often indifferent about the welfare of the people their troops are trying to improve, while putting their lives in danger.

2. Which raison d’etre?

A good strategy should entail coherent and consistent employment of available means in efficient ways to achieve definite aims. For the new Strategic Concept of NATO to work, it should be explicit about its core purpose, just as it was in the previous iterations. Unti at least 9/11, the core purpose of NATO was uncontroversial – collective defence of NATO’s territory and population against an attack of a conventional, near-peer enemy, in the past epitomized by the Soviet threat. 9/11, however, ruined the strategic imagination of the Allied planners and redefined the type of attacks that the Allies should anticipate in the future. It has been assumed that to prevent such attacks, the collective defence of NATO must start at the Hindu Kush rather than NATO-Russian borders. The crux of the issue is this: is it possible to reconcile NATO’s historic raison d’etre of defending NATO’s territory with the newly discovered sense of duty to build peace, security and prosperity in places as far away from Allied territories as Afghanistan or Horn of Africa? 39 2.1. Afghanistan, and beyond

NATO’s gargantuan effort in Afghanistan seems to be defining the Al- liance more than anything else. As of winter 2009, NATO Allies were stuck in Afghanistan, with rather bleak prospect for a successful exit. The war in Afg- hanistan is variously labeled the “forgotten war” and the “un-winnable war”. On 7th October 2009, the war turned 8 years old, counting from the beginning of “Enduring Freedom” operation, which was soon overshadowed by the “Iraqi freedom” (hence “the forgotten”). NATO started to take charge of the entire country in 2003, and the end to the war is still nowhere in sight (hence “the un-winnable”). And yet, the ISAF mission is what defines NATO of the 21st century, for better or worse. All 28 Allies are fully committed to this common cause, including through troops and/or civilian experts. A number of partner countries (15 in all) is on board, bringing the total number of troops to some 71 000, supported by (or supporting) 94 000 Afghan National Army personnel.6 NATO is working, cooperating (and sometimes even coordinating) its activities with a number of international organizations, primarily the UNAMA and the EU, and a myriad of various non-governmental outfits. The very nature of the operation is remarkable in several respects: it was initially conceived as a NATO response to the 9/11 attacks on the US soil, so basically as an Article-5 type of operation, i.e. defence of the Alliance territory and population. However, it has quickly evolved into a massive security, stabilization, reconstruction, training, development and even nation-building effort, taking place in a hostile environment, very far away from the Alliance border’s (unlike another major NATO’s endeavor in the Balkans). The NATO leadership itself considers Afghanistan as a crucial test of the organisation’s political viability and military credibility. George L. Robertson has famously proclaimed that NATO needs to go to Afghanistan, or else Afgha- nistan will come to NATO. The Declaration on Alliance Security clearly states Afghanistan to be NATO’s “key priority”. The former Secretary General Jaap de Hoop Scheffer was persistently repeating that NATO’s credibility is at stake in Afghanistan throughout his term in office. With the benefit of hindsight, it may yet turn out to be quite a costly stake. On the one hand, the Afghanistan operation clearly gave NATO a new life after it has sorted out the Balkans. No less importantly, it also keeps Alliance’s name in the news headlines. Even if the media coverage tends to focus on the negatives (civilian casualties, failure to stem drug production, fraudulent Presidential election in the summer 2009, growing number of suicide attacks etc.), the occasional spotlight saves NATO from the complete oblivion in the eyes of the internet generation, which is coming of age and becoming the main group of tax-payers, upon which, ultimately, all defence budgets of all Allies will depend. On the other hand, framing ISAF in fatalistic terms of “make or

6 Official information on NATO website (as of 22-10-2009): http://www.nato.int/isaf/docu/epub/pdf/ isaf_placemat.pdf 40

break” may indeed endanger Alliance’s long-term credibility because neither Afghanistan nor any similar future endeavor will not be concluded by a simple “victory” or “defeat”, but rather an indefinite sustained commitment. Yet, one could also argue that to some extent NATO is in a league of its own, whatever the long-term outcome of its presence in Afghanistan – no other international organisation can deploy and sustain so many troops over such a long period of time at such a distance, and for such a complex civil- military mission. Profound NATO’s commitment in Afghanistan stands in quite a contrast to what NATO was unable, incapable or unwilling to do in other parts of the world, including on its periphery. The Iraq war stands out as one of the most divisive moments in Alliance’s history. The lowest point was reached in the wake of America’s invasion, when NATO has wavered at Turkey’s request for precautionary reinforcement of Turkey’s defences. While the transatlantic rift has mostly healed, and NATO has been running its own small training mission in Iraq since 2004, the Turkish episode left a lingering stain on the credibility of commitment to mutual defence among all Allies. NATO has been all but absent from all the other conflicts in the Middle Eastern quagmire, despite the region’s proximity. NATO, despite being, among other things, a nuclear alliance, has not been involved in any meaningful way in resolving Iran’s nuclear riddle. Notwithstanding the efforts to nurture a wide variety of partnerships, including through the Istanbul Cooperation Initiative and the Mediterranean Dialogue, NATO has been a non-factor in Israeli conflicts with its Arab neighbors and the non-state militant outfits, primarily Hamas in Palestine and Hezbollah in Lebanon. Such NATO absentia from a region, which constitutes a quintessential element in the puzzle of global security, is puzzling indeed. While Israel, at least, is not part of the Euro-Atlantic Partnership Coun- cil, the Russian Federation and Georgia both have enjoyed special and even institutionalized partnerships with NATO – a fact that did nothing to prevent a war between the two. Paradoxically, that same fact may have something to do with the origins of that conflict.

2.2. Russia: cumbersome, but indispensable

Russia is still to a large extent what Robert Cooper would call a modern nation-state (with some of its regions, primarily North Caucasus, plunging back to anarchical, pre-modern sate). Compared to the European Union - an increasingly post-modern, post-sovereign and post-national space – NATO, a political-military alliance with strong roots in the 20th century power politics, would seem to be better placed to understand, cooperate and confront Russia, as necessary. However, the inner tension within the Alliance between the transformation urge and traditional security needs, all but eliminates this advantage. As a result, the Alliance quite simply does not have a coherent Russia policy, 41 and can only pursue a cumbersome relationship of “one step forward, two steps back”. This tension was most visibly exposed by the war in Georgia.7 NATO went out of its way to declare “no business as usual” after Russia’s military invasion into Georgia on 08/08/08, only to de facto recognize the new reality on the ground a few months later by going back to “normal business” and even “new beginning”.8 The conflict took place between two Partners of NATO: a country that is a member of a joint format (NATO-Russia Council) and a country, which was promised membership in NATO at the Bucharest Summit in 2008. The latter fact did not prevent Georgia from foolishly buying into Russian provocations, and the former fact did little to moderate Russia’s brutal response and subsequent occupation of parts of Georgia proper. In the end of the day, it was the French President and the EU that helped bring the armed conflict to an end, not NATO. As if to add insult to the injury, in September 2008 NATO has stumbled upon a serious breach of Alliance’s security of information, when a high-ranking Estonian defence official was apprehended for supplying classified NATO documents to the Russians. In a commendable if belated exercise of face- saving, NATO expelled two Russian spies on the occasion of the resumption of NATO-Russia Council meetings in the end of April 2009.9 The Soviet Union defined NATO’s raison d’etre during the Cold War. To- day, Russia still remains an extremely important feature, shaping the Alliance’s identity. First, a number of Allies, especially those on the eastern side of Eu- rope, harbor various real and imagined security concerns, as well as historic grievances, towards increasingly assertive, revisionist Russia. Those include energy security, cyber security, political and economic meddling, and after Georgia, even military security concerns. These insecurities were clearly manifested by a recent “open letter to President Obama” from prominent Central and Eastern European figures.10 Second, while most Western European Allies do not necessarily share these concerns, they also struggle to build a lasting constructive partnership without recurring surprises of energy cut-offs, high- profile assassinations, unpredictable economic climate for Western businesses inside Russia, and Russia’s constant political and now also military meddling in Europe’s Eastern neighborhood. Third, the NATO-Russia relationship is truly reciprocal – Russia is one of the very few countries outside NATO that pay very close attention to every action, reaction or statement by NATO. All too often, it is the rather frequent and mostly negative statements by Russian officials that define NATO in the eyes of the public. This is not a bad thing per se, as long as it helps keep NATO in the headlines.

7 Erlanger S., “West is struggling to unite on Georgia”, International Herald Tribune, 2008-08-18. 8 See ‘’NATO and Russia: A New Beginning’’, speech by NATO Secretary General Anders Fogh Ras- mussen at the Carnegie Endowment, Brussels, 18 september, 2009, http://www.nato.int/cps/en/natolive/ opinions_57640.htm, 2010 05 20. 9 Barber T., “Russians expelled in NATO spy storm”, Financial Times, April 30, 2009. 10 See: “An Open Letter to the Obama Administration from Central and Eastern Europe”, Gazeta Wyborcza. pl, 2009 07 15, http://wyborcza.pl/1,75477,6825987,An_Open_Letter_to_the_Obama_Administration_ from_Central.html, 2010 05 20. 42

The Economist has recently argued that “the Russians may already have achieved much of what they want”, namely, halting NATO enlargement and the plans for a missile defence site in the Eastern Europe.11 That assertion clearly assumes that Russia does have an articulated strategy vis a vis NATO and the United States. It is much less clear whether the same could be said about the Allies. Indeed, there is a quite glaring lack of a coordinated approach, not to mention strategy, on Russia. Passages devoted to the partnership with Russia in the most recent NATO communiqués are usually rather cumbersome ones, a mixture of great expectation and belief in amazing potential on one hand, and cautious rollicking for unfulfilled commitments with regard to Georgia and feet dragging over such issues as the Treaty on the Conventional Forces Europe (the CFE – Russia suspended its participation in the summer 2007). The banal explanation for this mish-mash approach is the differences in viewpoint between the Allies who used to be on the West side of the Iron Curtain and those who are still labeled “ex-communist” countries by the Western press (not so much by the Eastern European press though). One can also assume that this division is well understood, appreciated and further exacerbated by the decision makers in Moscow. The popular logic behind the “strategic importance” of NATO-Russia cooperation is twofold. First, political dialogue is a value in itself, which should help build mutual trust and confidence, and (sometimes) avoid conflicts. Alt- hough this relationship was launched in 1997, and further reinforced by signing the Rome declaration, establishing NATO-Russia Council in 2002, the new Russian security strategy, adopted in 2009, is very explicit about naming NATO a security threat to Russia. So much for the trust and confidence building. As for conflict prevention, no frozen conflicts in the mutual neighbourhood were resolved via the NRC, and one frozen conflict burst into open combat despite the NRC. The second popular reason behind the illusion of NRC cooperation is the fight against common security challenges – first and foremost terrorism and proliferation. In the case of the latter, Russia is more of a liability than help, with Iran being point in case. As for terrorism, a couple of Russian vessels did take part in NATO anti-terrorist operation in the Mediterranean for a few weeks over the last 5 years. And Russia has granted transit non-military supplies to NATO forces in Afghanistan, while at the same time worked to obstruct such transit through Kyrgyzstan. At the same time, Russia failed to gain Western acknowledgment that its violent crackdown on Chechnya was an entirely anti-terrorist operation, albeit atrocities of Chechen separatists (like the one in Beslan school in 2006) did earn some sympathy for the Russian version of the Chechen tragedy. NATO enlargement has been an implicit element of NATO-Russia relationship ever since the fall of the Berlin wall. In December 1996, to assuage Russia, NATO unilaterally declared that enlarging the Alliance would not require a change in its nuclear posture and, therefore, NATO has “no intenti-

11 “A new balance in Europe”, The Economist, 21 Nov 2009, p. 36. 43 on, no plan, and no reason to deploy nuclear weapons on the territory of new member countries”.12 The 1997 NATO-Russia founding act, which established the Permanent Joint Council, contained a clause wherein NATO has pledged to refrain from “additional permanent stationing of substantial combat forces”.13 These provisions helped Russia to swallow the first batch of former Warsaw pact allies – Poland, Czech Republic and Hungary acceding NATO. Creation of the NATO-Russia Council, in which all countries participate as equals and which makes decisions by consensus, was one of the crucial stepping stones towards the 2004 enlargement round, that brought another 7 Central and Eas- tern European countries into NATO. However, despite the pathos of the Rome Declaration which promised “a new quality”, the relationship has soured gradually: first, Russia abruptly suspended its participation in the CFE, which was hitherto considered “the cornerstone of European security”. The relationship reached a freezing point after the 2008 August war. Georgia’s and Ukraine’s movement towards NATO membership played a major part in this deterioration. The idea of the “new security architecture for Europe”, put forward by the Russian President D. Medvedev in June 2008 and quite actively promoted ever since might be considered as the groundwork for another “quid pro quo” type solution that preceded the first two contentious enlargement rounds. It all ties back into the question of NATO’s identity: how far and, no less importantly, why NATO could or should expand any further? Who can and cannot become NATO members? And why the number of Allies nearly doubled after the Cold War, which was its raison d’etre in the first place? The primary source – Article 10 of the North Atlantic Treaty – states that the Allies “may, by unanimous agreement, invite any other European State in a position to further the principles of this Treaty and to contribute to the security of the North Atlantic area to accede to this Treaty”. So, in theory, both Ukraine and Georgia should be considered eligible future members (as was recognised by NATO itself during the Bucharest Summit) if they are “in a position to contribute to the security of the North Atlantic area”. As in the case of the first two enlargement rounds, the argument again boils down to this: will accession of new members despite Russia’s objections enhance or undermine Euroatlantic security? The two precedents prompt towards a positive answer. However, the lack of political and public consensus in Ukraine, and Georgia’s territorial problems make both cases questionable. Nevertheless, it is also clear that the decision to open the “open doors” of NATO to new members is a political one: if all Allies agree that a country is worthy to join the treaty, it will happen, regardless of the country’s “position to contribute”.

12 NATO’s Nuclear Forces in the New Security Environment, available online: http://www.nato.int/issues/ nuclear/sec-environment.html 13 Founding Act on Mutual Relations, Cooperation and Security between NATO and the Russian Federation signed in Paris, France, 27 May 1997, availabe online: http://www.nato.int/cps/en/natolive/official_texts_25468.htm 44 3. A common-sense NATO

NATO’s difficult quest for stabilization and reconstruction in Afghanis- tan and indecision about its policy vis a vis Russia prompts to the need for the Alliance to go back and reconsider its grass-roots and re-address a number of core conceptual dilemmas. For NATO to remain “the most successful alliance in history”, it should not allow the outside factors to define its role in the world, but rather opt for a simple “NATO first” principle, which would entail answering simple question of what NATO could, should and would be able to do in the dynamic security environment of the 21st century?

3.1. A regional military block vs. a global political Alliance

The Cold War NATO in a sense was a boring organization. It had a sin- gularly clear purpose: deter, and, if deterrence fails, defend against the Soviet conventional and nuclear onslaught. The Washington Treaty defined its area of operations in quite rigid terms: in the Treaty’s preamble, the Allies committed to “seek to promote stability and well-being in the North Atlantic area”, meaning NATO-Europe and North America. Its military purpose of collective defence trumped its political role and utility as a platform for political consensus-building. Although NATO did embody the transatlantic link, it did not prevent both sides of the Atlantic from pursuing quite different and sometimes even conflicting political approaches towards the Soviet Union. For example, the purpose and logic of the American “containment” doctrine or even the concept of “détente” was of quite different nature than the Ostpolitik, which basically accepted the new status quo in Europe. NATO’s military structures were geared towards one total war. The Allied armies were massive, based on conscription, and organized into heavily- armoured divisions. At the spearhead of the potential conflict with the Russkies was the Allied Command Europe Mobile Force (AMF), which was “organised into various pre-planned, multinational force packages optimised for deployment” to five contingency areas in the Northern and Southern Europe.14 The somewhat scary logic behind this force was to ensure that there are as many as possible different national flags on the first coffins returning from the front line of the Third World War, so as to ensure that no Ally will be able to defect from the collective defence commitment. The United States permanently kept some 200 000 forces in Europe, most of them in the West Germany – the central battleground of the “worst case” scenario. A formidable nuclear umbrella provided by the Americans to the rest of the Alliance made sure that the cost of that “worst case” scenario would be unbearable even to the most reckless Soviet leadership.

14 More on AMF, see: Palmer D.R., “From AMF to NRF”, NATO Review, March 2009 45

All that MAD (“mutually assured destruction”) logic collapsed together with the Berlin wall. NATO has been “transforming” ever since, with transformation often perceived as a process rather than a destination. Some of the key dilemmas NATO continues to grapple with are presented in the Table 1 bellow.

THE COLD WAR NATO VS THE 21st CENTURY NATO?

REGIONAL BLOCK GLOBAL NATO

MILITARY ALLIANCE POLITICAL FORUM

WARFIGHTING COMPREHENSIVE APPROACH

MOST DEMANDING OPERATIONS MOST LIKELY OPERATIONS

HEAVY ARMOUR, CONSCRIPT ARMIES EXPEDITIONARY FORCES

Table 1. NATO’s dilemmas

NATO has clearly gone “out of area” – first to the Balkans, than Afgha- nistan and Iraq (with a modest training mission) and, most recently, the Horn of Africa. It has an even more impressive network of partnerships: the Euroatlan- tic partnership council (EAPC) encompassing 22 Partners, the Mediterranean Dialogue (7 countries), the Istanbul Cooperation Initiative (4 Gulf countries), the format involving the non-NATO ISAF contributors, NATO-Russia Council, NATO-Ukraine Commission, NATO-Georgia Commission, and bilateral relationships with the so-called “Contact Countries” as distant from the Atlantic as Australia, Japan, South Korea and New Zealand. Yet, it is definitely not a global policeman and hardly aspires to be one. Apart from the Afghan endeavour, NATO is not present in many other hotspots of the world. Furthermore, there is something wrong with the overall framework of the Alliance’s partnership framework. Sweden and Finland, which are probably more NATO-interoperable than some of the NATO members and are significant contributors to NATO operations are treated the same way as other EAPC members, like Turkmenistan, Uzbekistan, Tajikistan, Armenia or Belarus – countries with very dubious record of human rights and extremely meager democratic credentials. The above mentioned Contact countries, which “share similar strategic concerns and key Alliance values”15 and have more in common with NATO than a few formal Partners, have yet to receive a more meaningful and long overdue acknowledgment. NATO institutional partnerships with other key international bodies –

15 Official information on the NATO website, “NATO’s relations with Contact Countries”,http://www.nato. int/cps/en/SID-B1F50273-84ED580F/natolive/topics_49188.htm, 2009-12-08 46

the United Nations and the European Union – have become the staff of lore. Despite a long record of practical cooperation, only in September, NATO and the UN managed to work out a formal “framework for expanded consultation and cooperation”. The relationship with the European Union, which has an overlapping membership of 19 nations, no less, has been described in terms of a “frozen conflict” by the former NATO Secretary General Jaap de Hoop Scheffer.16 To sum up, NATO is no longer just a regional block, but neither has it become a truly global NATO. More importantly, the new Strategic Concept will hopefully streamline and rationalise the expanding NATO partnerships network and clarify what meaningful purpose this network should serve. The numerous cooperation and dialogue frameworks that NATO has launched allows to contend that it is much less military and much more political Alliance than it used to be during the Cold War. At the same time, one could argue that NATO’s political power has stemmed from its military prowess. Today, however, military power is no longer the sole or the most important determinant of the world affairs. Increasingly interdependent global economy, competition over energy and other vital resources, climate change, changing demographic face of the Western societies, the exponential growth of importance (as well as vulnerability) of cyberspace in daily life, are key some of the key features of contemporary international politics. While NATO’s military superiority is unrivalled and will remain so in the foreseeable future, to avoid the deflation of its political role and remain relevant, NATO had to take note of these new dynamics.

3.2. From war-fighting to “comprehensive approach”?

While NATO, ostensibly, still remains about security of the Allies (and not, for example. creation of economic welfare), the question is which threats and challenges it should address? The Comprehensive Political Guidance (CPG) (a sort of an interim update to the Strategic Concept, adopted in 2006) highlights to principle threats - terrorism and weapons of mass destruction. This classification, however, has some implicit theological problems. In European mindset, terrorism is pretty much a business for police and judiciary system. George W. Bush’s “war on terror” by means of military force has lead to the Iraqi quagmire. A more legitimate front of that “war on terror” – Afghanistan, is more reminiscent of an asymmetrical guerilla conflict, although the opposing force does use terrorist methods. In any case, it would be an awkward task to paint NATO - a military alliance – as a global anti-terrorist police force. As for the second threat – proliferation of WMD – again, NATO’s record is extremely meager. Operation Active Endeavour is the most visible and probably the only clear-cut effort in that regard. As it was argued above, NATO is

16 Jaap de Hoop Scheffer “NATO and the EU: Time for a New Chapter”, 29 Jan 2007, available online: http://www.nato.int/docu/speech/2007/s070129b.html, 2009-12-08. 47 nowhere to be seen on the dossiers of key proliferators, such as North Korea or Iran. Moreover, the Allies do not even have a common policy on nuclear non- proliferation and disarmament issues. They do not coordinate their positions on the NPT (the Nuclear Non-proliferation Treaty). In the UN, some Allies vote in favour of nuclear policy-related UN resolutions that may undermine the agreed official NATO’s nuclear policy. Energy security is another high profile dossier. The CPG mentions the “disruption of the flow of vital resources” as one of the key challenges for the Alliance. While NATO’s subsequent public declarations hints at some steps undertaken to bolster its role in energy security matters, there is objectively little a political-military alliance can do about an essentially political-economic problem. Developing rapid response energy security brigades to dissuade the major energy suppliers from using gas cut-offs as a political weapon is hardly a serious option. Not surprisingly, the CPG stipulates that “collective defence will remain the core purpose of the Alliance”, but caveats this statement with a notion that “the character of potential Article 5 challenges is continuing to evolve”. It is not entirely clear what this implies in practice. For example, some Allies (most notably Estonia in 2007) have experienced quite extensive cyber attacks in the past few years. Just like energy cut-offs, such security challenges can severely threaten and even breach social, economic and financial integrity and stability of the Allies, and in that sense, probably fits the description of an “evolving character of potential Article 5 threats”. However, it is unlikely that they could evoke activation of Article, let alone the use of military force to counter challenges of completely different nature. Again, the new Strategic Concept should provide more clarity on this issue. NATO may well have to stick to the well-trodden approach in the new Strategic Concept, reiterating the collective defence as the core purpose of the Alliance. Secondly, the Allies will likely re-state once again that NATO is not against anybody, but in favour of world-wide peace, security, stability, security and prosperity, leaving the question of boundaries of NATO’s possible area of action an ambivalent “wherever needed and called upon”. Even if the common sense dictates that NATO should maintain its focus on what it does best – defence planning and military action, the nature of contemporary military engagements has been changing dramatically, as showcased by the Iraq and Afghanistan experiences. The United States-led coalition in Iraq and NATO in Afghanistan have learned the hard way that military superiority alone is not enough – political reconciliation among the warring factions and economic development and reconstruction are probably even more important, because they address the root causes of the conflict. Success in a quagmire like Afghanistan requires both a concerted decision making of different international organizations and a coordinated civilian-military action on the ground. Yet, 8 years into the campaign, NATO is still struggling with the concept of the so-called “comprehensive approach”, for a number of reasons. First, most international organi- 48

zations like to “coordinate” but do not like to be coordinated. For example, the UN considers itself the most important organization in Afghanistan, despite the fact that the Allies carry by far the biggest burden. Second, the Allies are undecided whether NATO should develop its own civilian capabilities, or depend for those on organizations like the European Union, despite the fact that NATO already runs a number of provincial reconstruction teams (PRTs), which do exactly that - coordinated civilian-military efforts of stabilization and reconstruction. Finally, each country leading a PRT in Afghanistan runs its own little experiment of “comprehensive approach” with little or no coordination at the national level. As a result, there are a lot of “comprehensive approaches” without a single agreed NATO policy. In a sense, the expectations placed upon NATO’s forces are more complex than ever. They are supposed to be extremely professional and well-versed in advanced technologies, like UAVs, precision-guided munitions and other network-enabled capabilities. They are expected to deploy on short notice at long distances with little or no host nation support. They have to be able to perform joint multinational expeditionary operations in hostile environment. They are expected to fight and help build hospitals and schools simultaneously in the same area of operations. They are no longer just soldiers, but also experts in tribal diplomacy, Islamic religion and indigenous culture. This was the basic idea behind the NATO Response Force – a 25 000-strong force capable of performing missions worldwide across the whole spectrum of missions from humanitarian aid to Article 5. NATO has declared the NRF fully operational in Riga Summit in 2006, but had to recall this decision a few months later due to repeated failures to generate the required capabilities. NATO’s level of ambition outlined in the CPG is ambitious indeed: “NATO must retain the ability to conduct the full range of its missions, from high to low intensity, placing special focus on the most likely operations, being responsive to current and future operational requirements, and still able to conduct the most demanding operations.”17 This provision reflects the search for an uneasy balance between the need to focus on “most likely operations”, like Afghanistan, and at the same time to retain the capacity to react to a less likely but more demanding conventional scenario. Given the constantly persisting capability shortfalls in Afghanistan and the failure to generate the NRF, one may question whether NATO would be able to undertake another major crisis response operation simultaneously with the ongoing Afghanistan mission? The answer probably would be conditioned on the level of the US involvement. After all, many allies did take part in both ISAF and Iraqi operation, although the latter was not carried out under the NATO flag. More recently, the US draw-down in Iraq allowed Obama’s administration to boost its troops presence in Afghanistan. In any case, the

17 See: Comprehensive Political Guidance, Endorsed by NATO Heads of State and Government on 29 November 2006, http://www.nato.int/cps/en/SID-94B7F554-9A0B094E/natolive/official_texts_56425. htm, 2009-11-25 49 tension between the political ambition and the available resources is likely to continue in the foreseeable future, because apart from a few notable exceptions (the US, France, the United Kingdom, Turkey and Greece), the defence expenditures have been flat or even decreasing in most European countries over the past few years. An additional concern is the strategic awareness of Alliance’s defence planners. The military has a notorious habit to prepare for the “last war”. While today the “most likely” scenario presumes an Afghanistan-type mixture of counter-terrorism, stabilization and reconstruction effort, facing an asymmetrical and militarily inferior foe. The war in Georgia was a stark example of a different kind of war – a brief and violent inter-state encounter. NATO puts a premium on developing light expeditionary force, which is well suited for asymmetrical combat. But would this same force equally ready to fight a conventional war against a heavily-armored opponent? Probably the only country, supported by a rag-tag collection of allies (mostly from the Central Asia) that have the potential and may have some motives to challenge militarily some of the adjacent NATO allies is Russia. By any measure, Russia would fail in a large scale conventional war against NATO. While this is all very hypothetical, two factors could somewhat com- plicate such a straightforward analysis. First, the question is open how fast and by what means NATO would react. Article V would probably be evoked, but the nature of the response operation would be a contentious matter. Probably the biggest unknown is whether Russia believes in NATO’s solidarity when it comes to the defence of smaller and weaker neighbouring Allies. From a Russian perspective, a rapid military incursion with limited objectives (say, on the grounds of crisis management, protection of its “citizens” and other imaginative causes) into an undefended Ally is not completely unimaginable, especially based on the Georgian example – a NATO partner, which was promised to become a member. Another X factor is Russia’s nuclear doctrine, which clearly and unambiguously stipulates the possible of “first use” of a nuclear weapon even in a regional conflict, when Russian interests are threatened. And Russia happens to have a few thousands of tactical nukes, including (most probably) on its European theatre. While all this is extremely hypothetical, future developments in international politics are very difficult to forecast. Further economic downturn, disgruntlement of the military and society at large, social unrest may prompt Russian leadership to once again divert the public attention to the outside “enemies”. It is clear that the new Strategic Concept will not call upon NATO “to come home”18. At the same time, NATO should at least ponder different possibilities, however unlikely, especially if they may endanger directly Alliance’s territories and population.

18 Ringsmose J., Rynning S., “Come home, NATO? The Atlantic Alliance’s New Strategic Concept”, DIIS Report, 2009, no 4, (Danish Institute for International Studies), http://www.diis.dk/graphics/Publications/ Reports2009/DIIS_report_200904_RingmoseRynning_NATO_web.pdf, 2010 05 10. 50 4. Five Years of Membership - “Curb Your Enthusiasm?”

The Strastbourg/Kehl summit has coincided with the 5th membership anniversary of 7 “newer” Allies, including Lithuania. While NATO‘s Stras- bourg communiqué was misread by some in Lithuania19, it raised a pertinent question – have Lithuania become an indispensable part of NATO and got rid of the self-perceived presence on the periphery of the Euro-Atlantic area? After all, political geography is a mental, not a material state of play. As I have argued elsewhere, “Yesterday came suddenly” for Lithuania.20 By achieving the two greatest historic objectives – memberships in NATO and the European Union, Lithuania has lost clear strategic landmarks for the future. “Being active member of NATO and EU” – a prominent slogan in various national foreign and security policy documents of Lithuania, does not have the sense of strategic urgency, does not capture attention and does not inspire awe and admiration on behalf of the respective publics. While great historic achievements are not readily available for Lithuanian decision makers, there are more than enough challenges and dilemmas to tackle. The 5 years of membership in both NATO and the EU brought a number of revelations. First, while Lithuania sought the Euroatlantic integration and considered NATO hard security guarantees and EU soft security guarantees as two sides of the same coin, they soon learned that both organizations are distinct and sometimes even competing defence actors, with different ambitions and different institutional set-up. In addition, both are essentially global actors with global partnerships and outreach, while Lithuania’s interests and concerns are objectively confined to the Baltic region. Last but not least, Russia is seen by many in NATO and the EU as an important or even “strategic” partner, while for Vilnius it essentially remains a security problem of strategic proportions. The drafting of the new Strategic Concept is important for Lithuania for at least two reasons. First, Lithuania was not part of NATO when the 1999 document was agreed. So, at least formally, Lithuania together with other new member states, will have a chance to shape the future of NATO. Quite paradoxically, the new concept may move NATO even further away from what Lithuania envisaged NATO would be and should be for their security. Secondly, it is an excellent opportunity for Lithuanian decision makers to engage the drafting process as an intellectual exercise of intros- pection, in search of a new and clear national security vision, i.e. what kind of security environment they want to live in, what threats are most acute, and what means (national or multinational) should be employed to address those threats.

19 Samoškaitė E., “NATO aljansui esame periferija?” [We are NATO‘s periphery?], Delfi.lt, 4 April 2009 –., http://www.delfi.lt/news/daily/lithuania/article.php?id=21326605, 2010 05 20 - in Lithuanian. 20 See: Paulauskas K. “Yesterday Came Suddenly: the Brave New Security Agenda of the Baltic States”, in : Tiirmaa-Klaar H., Marques T., eds, Global and regional security challenges: A Baltic Outlook, Tallinn University Press, 2006, p. 15–41. 51

It may end up being an exercise in “curbing enthusiasm”. When Lithu- ania was entering NATO, a number of bold defence planning assumptions were made. These assumptions underpinned a rather overwhelming defence reform program. As the comparison in the table indicates, not all of those assumptions survived the reality check so far, but the results are not all bleak.

2004 assumptions 2009 realities Lithuanian armed forces will not fight alone – no No NATO defence plans need for a large conscript army Some informal defence plans NATO deploys prior to crisis to bolster NATO overstretched in Afghanistan, deterrence NRF not operational Lithuania in Afghanistan, and Air policing continues NATO in Lithuania

No need for territorial defence Conventional scenarios not impossible

Table 2. Assumptions and realities of Lithuanian defence planning

First and most importantly, steadfast credibility of collective defence commitment enshrined in the Article V of the Washington Treaty was taken for granted in Lithuania. Having secured invitation to accede NATO in 2002, Lithu- anian policy makers and in particular the leadership of the defence establishment could start focusing on a vast defence transformation effort, as required by NATO defence planners. NATO collective defence implies that no Ally will be left alone to cope with a threat to its territory or population. In return, however, each Ally must accept a fair share of the burden of collective defence. Lithuania, accordingly, had to realize that membership is not about NATO’s collective defence for Lithuania, but rather collective defence of the Alliance. Building upon that logic, Lithuanian armed forces were reorganised from a large, poorly equipped, poorly trained and immobile conscript army capable of only a limited territorial defence, into a smaller but better equipped and better prepared professional force, capable to generate and deploy certain specialized capabilities to NATO operations. From 1994, Lithuania has accumulated quite a long record of participation in international operations, which culminated in the decision to take over the responsibility for an entire province in the mountainous heart of Afghanistan – Ghowr in 2005. This decision essentially epitomized the logic of “Lithuania in Afghanistan, NATO in Lithuania”. Even if Afghanistan per se is not of primary importance to Lithuania’s national security and defence, Afghanistan, as it was argued above, is top priority for entire NATO. Only by abiding by the principle of solidarity with other Allies Lithuania can expect that same solidarity from those Allies in case of need. In case of Lithuania, that solidarity has one clear and tangible expression – the NATO air policing mission in the Baltic States, ongoing on a 24/7 basis since the accession day – 30 April 2004, and which is already scheduled to continue at least until 2014. 52

On the other hand, certain security concerns persist. The war in Georgia has shown that conventional conflicts among European states cannot be deemed impossible in the future. Lithuania, together with the other Baltic States, are, at least in geographical terms, clearly exposed territories on the periphery of the Alliance, which were considered “indefensible”21 long before their accession to NATO. If one adds a host of bilateral problems these countries experience in their relations with their big neighbor, Russian leadership should probably feel some temptation to test the limits of Alliance’s unity and resolve, as was demonstrated by the largest military exercises since Soviet era - Zapad and Ladoga, which took place in the immediate proximity of the Baltic States in the fall 2009. The Baltics themselves have long questioned whether collective defence guarantees can be credible without a clear contingency plan – these doubts have finally been heeded to some extent in the form of a generic informal defence plan, which was presented to the three countries in December 200922, partially due to Russia’s recent military adventurism. All in all, the record after 5 years of membership is mixed. Lithuania has come a long way in transforming its security thinking, its armed forces and its performance within the Alliance. It did learn to annoy some other Allies over such issues as Russia, energy security or Ukraine’s and Georgia’s infamously bumpy path to NATO. It is also quite capable at aligning its position to that of more powerful Allies – mostly the United States and the United Kingdom. Although Lithuanian defence planners are not always sold on the “expeditionary” philosophy of their Anglo-Saxon Allies, that philosophy at least envisages a strong and efficient NATO, while for some much more reluctant Western European allies NATO’s predicament has probably served its purpose. When the opportunities for annoying or aligning are exacerbated, Lithuania is left little choice but to acquiesce to the emerging consensus. Lithuania has yet master a more positive “Yes, we can” approach and learn how to get its interests onto NATO agenda and become more of a subject than mere object of NATO’s decisions. For example, not a single Lithuanian (or Baltic for that matter) national in 5 years of membership have succeeded in the selection process for A-grade (i.e. policy-related) positions in the NATO international staff. While selection of top officials is a political and sometimes highly politicized matter (as in the case of Turkish bargain for top positions in return for support for Danish candidate as the next Secretary General), the lower ranks are supposedly open to competition to all Allies. However, distribution of posts is to some extent a reflection of Allies’ comparative political weight, as well as an instrument of indirect influence upon decision shaping within NATO’s bureaucracy. In the Baltic case, that weight seems to linger below significant.

21 See, for example: Dalsjo R. “Are the Baltics defensible? On the utility of and prospects for a capability for self-defence”, RUSI Journal, London, 1998. 22 “Disquiet on the eastern front”, The Economist, 28 Nov 2009, p. 37. 53 Conclusions

NATO is not ready to ponder retirement yet, nor should it do so. Global ambitions, built upon overstretched resources and lackluster public support cannot be sustained for a long period of time. The Alliance may have to make a choice (rather than “to find a balance”) about its future purpose. One alternative is to remain a unique military organization ready for any contingency that requires robust, modern combat forces capable of surgical expeditionary interventions at short notice anywhere in the world. The alternative is a global multifaceted (and, therefore, often fragmented) forum for political dialogue and occasional action with multiple tasks, such as humanitarian aid, political consultations with any number of countries and organizations and undertaking various civil-military operations. Currently NATO seems to be stuck between the two alternatives. The danger is that by trying to do both NATO may fail at either, unless the Allied political leadership would throw considerably more resources and political will in support of NATO’s endeavors. Engagement in Afghanistan seems to be the defining moment for the Allian- ce. NATO’s leadership has even staked NATO’s future relevance on the success in Afghanistan. In addition, NATO runs an anti-piracy operation off the Horn of Africa, patrols the Mediterranean to stop proliferation of WMD, keeps the peace in Kosovo and trains forces in Iraq. On the other hand, NATO has not been present in the resolution of other major crises that took place recently – the renewed fighting Gaza or the war in Georgia. Iranian and North Korean problems are also being dealt with in other forums. While the 1999 Strategic Concept called NATO as THE forum for transatlantic political dialogue, NATO did not make its position (if any) clear and public on many of these matters, to say nothing about appropriate actions. And yet NATO does stand out head and shoulders above other aspiring security organizations. No other institution or organization was ready or able to sort out the Balkan mess until NATO has intervened in the form of SFOR in Bosnia and Herzegovina (there is some anecdotal evidence that the US has deliberately allowed the Europeans to fail in the Balkans to teach them a lesson of humility and the indispensability of American presence in European security affairs). Only NATO had enough will and firepower to stop what was then still Yugoslavia from continuing bloodshed in Kosovo. Finally, today only NATO is capable to carry out an operation as complex as ISAF. The spectrum of Alliance‘s missions and partnerships has expanded impressively since the end of the Cold War. NATO today is more global and more political, as opposed to its primarily regional and military predicament of the past. At the same time, the mantra of NATO‘s transformation may be masking a certain loss of direction, if not the degradation of its former political and military stature and prowess. To remain relevant in the dynamic security environment, NATO has been ponder ever news, such as energy security or cyber defence. However, at a closer examination, they do not fit easily with the traditional “core purposes” of collective defence and crisis response. 54

If the older members of the Alliance suffer from the “enlargement fati- gue”, the newer members have started to exhibit disillusionment and waning enthusiasm. However, one should expect that the teenaged democracies like Lithuania will soon mature into full-fledged and indispensable Allies. Arguably, Lithuania is already carrying its fair share of burden in NATO’s operations, which should be translated into a more considerable political weight in Brus- sels, not only Chaghcharan. In the end of the day, one could argue that NATO is still first and foremost about security and defence of Allies, whatever that means for different capitals. While NATO continues to adapt and reinvent itself in order to prepare for the future challenges, it should make sure that this simple, but essential premise does not get lost in transformation. 55

Martynas Zapolskis* Institute of International Relations and Political Science, University of Vilnius

NATO Transformation Scenarios

The method of scenario building is used in this article to identify and examine the eventual directions of NATO transformation. This article analyzes the main driving forces of the Alliance, as well as the parameters which define the transformation of NATO. On the basis of the theoretical scenario building model, which is designed in this article, four alternative scenarios of NATO are constructed: (a) NATO as a global mechanism for crisis management; (b) NATO as a fortress of collective defence; (c) NATO as a paralyzed political forum; (d) NATO as a multifunctional security structure. The article also aims at answering the question, under which scenario the transformation of the Alliance is currently proceeding. Finally, the practical applicability of the scenario building method in the field of Lithuanian foreign policy is evaluated.

Introduction

For the past several years NATO has increasingly been focusing on external activities: intensive enlargement, development of various partnership programs, large-scale operations in Afghanistan and Kosovo, counter-terrorism and counter-piracy activities, development of multifunctional rapid response force capabilities, etc. The Alliance is becoming increasingly dissimilar to the regional organization of collective defence. In the light of the ongoing transformation of the Alliance, many important questions about the nature, purpose and effectiveness of NATO become more and more relevant. It is not clear, where the limits of the NATO enlargement and partnerships are, what should be the balance between commitments for collective defence and out-of-area activities, what should be the role of the Alliance in the field of non-traditional and asymmetric security challenges generated by population growth, climate change, organized crime, humanitarian crisis, etc. It could be asserted that the spectrum of NATO’s functions and responsibilities is “diffusing”. The Alliance is trying to combine different functional models: guarantees of an effective collective defence, tasks of a global political forum and commitments to neutralize threats beyond the Euro-Atlantic area. In other words, the Alliance faces many problems, which can be summarized as the absence of a vision for its further development. As NATO is stuck in

* Martynas Zapolskis is a PhD candidate, Institute of International Relations and Political Science, Vilnius University. Address: Vokiečių g. 10, LT-01130 Vilnius, Lithuania, tel. +37069912172, e-mail: martynas. [email protected] 56

such a “strategic crossroads”, the questions regarding the future of the Alliance become crucially important: (i) which functional model will be chosen while adapting the Alliance to the rapidly changing security environment; (ii) what are the overall directions of further transformation of NATO; (iii) which factors can determine one or another model of the Alliance’s development. The complexity of the Alliance as a multifunctional subject of international relations is also revealed by the wide range of academic research. Various theoretical models (for example, the concepts of security communities, collective security, alliances, cooperative security, etc.) differently explain the logic of the Alliance and its interaction with other actors. NATO is characterized by features of modern (deterrence strategy, nuclear arsenal) as well as postmodern (focus on common values, engagement in crisis response/reconstruction operations) international security systems. From the Lithuanian point of view, the discussion about the future of NATO is very important as further transformation of the Alliance will directly affect Lithuanian national security. The ongoing process of developing a new NATO Strategic Concept is an exceptional opportunity for Lithuanian foreign policy makers to engage actively in the discussion about the future of the Alliance. The main objective of this article is to identify the main possible directions (scenarios) of NATO development as well as to answer the question, under which scenario the transformation of the Alliance is currently proceeding. The methodology of forecasting1 (particularly, the method of scenario building) is used in this article to examine eventual projections of NATO’s development. Scenarios are understood as descriptions of alternative projections of the development of the object under consideration. Scenario building is seen as an analytical instrument, which allows methodologically consistent exploration of how the development of the research object (in this article – NATO) can change depending on different configurations of its main driving forces. Scenarios thus expand on an understanding of the key drivers and their potential interaction. The Alliance is seen in this article as an international security structure, i.e. a complex subject of international relations, the main function of which is to ensure the security of the NATO. On the basis of the history of NATO transformation (Alliance‘s adaptation to the changing international security environment after the Cold War), it is assumed that NATO is a responsive structure, i.e. certain characteristics of international environment (specific configuration of threats and security challenges) determine respective set of NATO security measures.

1 Many synonyms of the term “forecasting” can be found in the academic literature: foresighting, futurology, futurism, prospectivism, future studies, futuristics, futurology, prognostics ir pan. See: Bell W., Foundations of Future Studies: History, Purposes, and Knowledge, New Brunswick: Transaction Publishers, 2003, p. 58-70. 57 1. Scenario Building in International Relations Research

1.1. Main characteristics of forecasting

Forecasting research is widely used for the analysis of various political, economic, social, environmental processes, tendencies of technological evolution, cultural paradigm shifts, etc.2 It is evident that different research objects require different analytical instruments, i.e. different forecasting methods. The selection of a particular forecasting method depends on the nature of the object, research purpose and available data. One of the most outstanding experts in the field of forecasting J. Scott Armstrong conducted a comprehensive analysis of the forecasting methodology and identified two basic categories – quantitative and judgmental methods.3 If precise quantitative data is available (usually possible in economics, demographic research, etc.), various quantitative forecasting techniques can be employed – simulation modelling, statistical analysis, econometric models, forecasting by extrapolation, etc. In the ideal case of quantitative forecast, the findings of the research are the same independently of the researcher (quantitative data can be manipulated in consistent and reproducible ways).4 If quantitative data is not available (or the research object cannot be quantitatively operationalised), Delphi surveys, scenario building, expert judgment, cross impact analysis and other qualitative techniques are usually applied. Qualitative methods are often criticized for being subjective and therefore lacking consistency, validity and reliability.5 On the other hand, qualitative approach can be very beneficial as it allows using of researchers’ intuition and experience – it is especially important in the analysis of various social processes. In case of international relations research, such complex concepts as “interests”, “power” and “security” usually are at the centre of the analysis. As it is complicated to quantify and measure such concepts, forecasting the development of international politics is usually based on qualitative methods

2 Groff L., Smoker P., Introduction to Future Studies, http://www.csudh.edu/global_option/IntroFS.html, 2009 11 10. 3 Other terms referring to the distinction between quantitative and judgmental methods are also used in the academic literature: (i) subjective and objective methods – see Armstrong J. S., Long Range Forecasting, New York: John Wiley and Sons Inc., 1985. (ii) data-based and judgement-based methods – see Gupta D. K., “An Early Warning about Political Forecasting: Oracle to Academics” in Schmeidl, S., Adelman H., eds., Early Warning and Early Response, Columbia International Affairs Online: Columbia University Press, 1998; 4 Miles I., Keenan M., “Handbook of Knowledge Society Foresight”, PREST, 2003, p. 81-93. 5 Washburn A. M., Jones T. E., “Anchoring Futures in Preferences” in. Choucri N., Robinson T. W., eds., Forecasting in International Relations: Theory, Methods, Problems, Prospects, San Francisco: W.H.Freeman and Company, 1978, p. 96. 58

of analysis.6 In particular, the method of scenario building is widely used in forecasting international relations and international security.

1.2. Scenario building: practical and academic perspectives

Practical (policy formation) and academic approaches apply scenario building differently in the field of international relations. From the practical point of view, two main manners of scenario usability can be identified: 1. Scenario building often plays an important role in the cycle of strategic planning.7 Forecasting allows one to react more flexibly to the changes of the strategic environment. Scenario building in this case serves as a link between a particular policy program and a decision to implement it. Scenarios expand the mental map of eventual future alternatives and thus facilitate the process of adjusting policy strategies and adapting them to the most likely scenario. For example, forecasting of the eventual changes in the strategic environment is very important in the process of planning and implementing national defence policy. 2. Scenarios can be used as practical guidelines for the implementation of foreign policy. The state, while forecasting eventual changes of its strategic environment, can not only “detect” “objective” driving forces, but also identify its own role in the scenarios. In other words, forecasting not only helps one to foresee the eventual development of the international environment, but also shapes it. Actors possessing considerable structural power in international relations (e.g. United States) have the ability to affect the transformation of international system, i.e. they can anticipate an active role for themselves in the future scenarios and thus facilitate the realization of their foreign policy agenda.8 From the academic point of view, scenarios have value added as an instrument of policy analysis. Scenario building is a methodological tool allowing one to explore those aspects of the research object, which might be underes- timated while using “traditional” methodology. There are many potentially important and currently “unthinkable” factors, which eventually might become crucial for the development of a certain actor – scenario building in this respect is very important as it enables a complex exploration of the environment of the research object. In other words, from the academic perspective, the main objective of the scenario building is not accurate forecast of the future, but, rather, methodologically consistent exploration of the research object. Scena- rio building is a tool to detect key drivers and to identify the impact of their

6 Janeliūnas T., Kasčiūnas L., “Prognozavimo metodų taikymas politikos moksluose”, Politologija, 2007/3 (47), p. 14. 7 Ratcliffe J., “Scenario Building: a Suitable Method for Strategic Real Estate Planning”, Property Mana- gement, 18(2), 2000, p. 3-7. 8 Janeliūnas T., Kasčiūnas L., “Prognozavimo metodų taikymas politikos moksluose”, Politologija, 2007/3 (47), p. 25. 59 various configurations (interactions) to the research object. Scenarios give an opportunity to “crystallize” social reality by designing and exploring several alternative development projections of the research object. Scenario building has a particular value as it can integrate various forecasting techniques: expert knowledge, Delphi surveys, statistical analysis, etc. Accordingly, it increases the flexibility and applicability of the scenarios in various fields9, including international relations research, which is often based on the combination of quantitative methods and analytical insights. Moreover, many forecasting methods generate only one future “version” of the research object (the field of analysis is thus limited) while scenario building provides several future projections and thus is a good basis for comprehensive research.10 Two main types of scenarios can be found in theoretical scenario-building literature: 1. Extrapolation (descriptive model)11 – in this model the main driving forces of the research object are identified by exploring present situation. It is then analyzed what scenarios of the research object can be generated by different configurations of the key drivers. The core element of this model is the question “what, if..?”, i.e. different combinations of the independent variables and their impact to the research object is at the centre of analysis. 2. Goal-seeking (normative model) – on the basis of this model, firstly, one or several significant future states (wanted or unwanted) of the research object are selected; secondly, the pathways (specific configurations of the independent variables) leading to these states, are identified and analyzed. The core element of this model is the question, what circumstances or sequences of events would lead to the (un)desirable future state.

1.3. Theoretical model of scenario building

The success and results of scenario building very much depend on the methodological choices. It is specifically relevant in the field of international relations research, which is characterized by high complexity and multiple combinations of the variables. There is no universal model of the scenario building. Therefore, the choice of particular methodology each time depends on the purpose of the research.

9 Bood R.P., Postma T.J., “Scenario Analysis as a Strategic Management Tool”, University of Groningen, Faculty of Economics, 1998, p. 8. 10 Beck P. W., “Corporate Planning for an Uncertain Future”, Long Range Planning, 15(4), 1982, p. 18. 11 Two main types of scenarios (descriptive and normative) in this article are identified on the basis on the ideas of H. Kahn – one of the most distinguished figures in the field of forecasting. See: Kahn H., “Choosing a Perspective on the Future”, Hudson Institute, http://www.hudson.org/index.cfm?fuseaction=publication_ details&id=1161, 2009 10 10. 60

In accordance with the most important theoretical and practical research12 within the field of scenario building, 4 general stages of scenario building can be identified (see Figure 1). These stages ensure the methodological consistency of the forecast.

Figure 1. Main stages of scenario building (prepared by the author)

The application of scenario technique in the field of international relations research is a methodologically complicated task. Three main methodological questions are the most challenging: (1) which factors are the most important for the research object, i.e. what factors should be regarded as independent variables; (2) what should be the logic of selecting particular combinations (interaction) of the variables; (3) how to measure the impact of the independent variables on the research object. 1. The method of environmental scanning is appropriate for the identification of the key variables (social, political, economic, technological, ecological factors and their various combinations). Depending on the character of the research, (i) independent variables might be quantified by assigning a certain value to each variable; (ii) different meaning of the independent variables might be described by taking status quo as the starting point and then evaluating the increase/decrease of their intensity/scope/amount.

12 Van Notten P., et al., “An Updated Scenario Typology”, Futures, 35, 2003; Ratcliffe J., “Scenario Building: a Suitable Method for Strategic Real State Planning” Property Management, 18(2), 2000; Schwartz P., The Art of the Long View: Planning for the Future in an Uncertain World, Doubleday Currency, New York, 1991; Postma T., Liebl F., “How to Improve Scenario Analysis as a Strategic Management Tool?”, Technological Forecasting & Social Change, 72, 2005; Becker H., “Scenarios: A Tool of Growing Importance to Policy Analysts in Government and Industry”, Technological Forecasting and Social Change, 23, 1983; Van der Heijden K., Scenarios Strategies and Strategy Process, Breukelen: Nijenrode University Press, 1997; Cher- mack T. J., “A Theoretical Model of Scenario Planning”, Human Resource Development Review, 3(4), 2004; Keough S. M., Shanahan J., “Scenario Planning: Toward a More Complete Model for Practice”, Advances in Developing Human Resources 2008, 10(2), 2008. 61

2. The model of identifying certain configurations of the independent variables is usually determined by the nature and quantifiability of the variables. In accordance with the objective of scenario building and the type of available data, various methodological instruments can be selected – matrix, “decision tree” model, random interaction, extreme cases, etc. Variables can be selected and combined on the basis of different principles – plausibility, differentiation, consistency, decision-making utility, etc.13 The more variables that are included in the research, the more possible configurations become available. In order to select the most valuable combinations, the principle of rejecting insignificantly different scenarios can be applied: (i) many different combinations of the independent variables are identified; (ii) their impact to the dependent variables is analyzed and measured (“drafts” of the scenarios are prepared); (iii) scenarios are classified (divided into groups); (iv) insignificantly different scenarios are rejected and thus one scenario is selected/crystallized from each group. 3. In order to assess the impact of the independent variables it is essential to identify the dependent variables (parameters of analysis), which define crucial characteristics of the research object. The content of each scenario is revealed namely by the description of dependent variables and their certain combinations. Before focusing on the content of scenarios, the status quo of each dependent variable has to be described. Scenario building reveals eventual changes of this situation subject to different configurations of independent variables. Based on these principles, theoretical scenario building model is constructed (Figure 2). This model is the background for further analysis in this article.

Figure 2. Theoretical model of scenario building14 (prepared by the author)

13 Ratcliffe J., “Scenario Building: a Suitable Method for Strategic Real State Planning” Property Manage- ment, 18(2), 2000, p. 10. 14 The methodology used in a study “Future World Scenarios” (conducted by the Allied Command Transfor- mation) can be regarded as a starting point of the research principles reflected in this theoretical model. See: Allied Command Transformation, “Future World Scenarios: Supporting Paper to the Long Term Requirements Study”. http://www.act.nato.int/multiplefutures/ACTFutureWorldScenariosApr06.pdf, 2009 11 02. 62 2. Directions of NATO transformation

2.1. The driving forces of the Alliance

The analysis of NATO‘s strategic environment and internal dynamic reveals two key factors, which are the most important for the transformation of the Alliance: (1) the characteristics of international security environment (the main challenges for the security of the Alliance can be divided into 2 groups: “modern” and “postmodern”); (2) the internal dynamics within NATO (relations between member states and their interest in the efficiency of the Alliance. Accordingly, three groups of independent variables can be identified. Each group contains three variables, which define certain parameters of the external environment and internal dynamics of the Alliance: 1. “Modern” security challenges: (a) aggressiveness of Russian foreign policy; (b) threats posed by alternative centres of power (states and political- military blocks); (c) threats posed by unpredictable and aggressive (“rogue”) states. 2. “Postmodern” security challenges: (a) asymmetric threats; (b) threats posed by transnational organized crime and socio-economic problems; (c) threats posed by the lack of critical resources and negative impact of the climate change. 3. Internal NATO asymmetry (a) US disinterest in the efficiency of NATO; (b) disagreements between NATO members; (c) evolution of European Security and Defence Policy (ESDP/CSDP)15 as the counterbalance to NATO. In accordance with the theoretical model, each variable can obtain five different values: zero (0) value defines the status quo of the variable and is described in the table 1. Possible changes of the status quo are defined by the increase (+1 or +2) or decrease (–1 or –2) of intensity of the variable. Importantly, the research of NATO transformation scenarios in this article encompasses long a term period, i.e. it is assumed that all forms of independent variables might become evident within the period of 10-15 years.

15 In accordance with the Lisbon Treaty, which entered into force on 1 December 2009, the ESDP was ‘upgraded’ from a ‘European’ to a ‘Common’ Security and Defence Policy. The abbreviation “CSDP” is therefore used in this article. 63 Table 1. Independent variables (driving forces of the Alliance)16

Main independent variables (status quo)

- The Alliance is regarded as a hostile actor. - Military force is used against NATO partners. - Hostile political rhetoric is used with regard to NATO. - Disagreement with various forms of NATO policy (enlargement, missile defence, etc.) - Energy and economic pressure; aspirations to influence internal political process in certain NATO countries and partners. - International commitments are not fulfilled. policy - Support for the states, which are hostile to the Alliance. - Sustainment of large scales of nuclear arsenal; intensive development of conventional military capabilities. - Frequent demonstration of “military muscle”: large scale military exer-

Aggressiveness of Russian foreign cises, strategic bomber flights, etc.

16 Independant variables were identified on the basis of two groups of sources: 1. Analytical forecasting studies, which focus on the analysis of international security tendencies and eventual development of various international threats (security challenges): Allied Command Transformation, “Future Security Environment”, Norfolk, 2007, http://www.act.nato.int/multiplefutures/ACTFutureSecurityEnvironmentFirstEdition.pdf; National Intelligence Council, “Mapping the Global Future: Report of the National Intelligence Council’s 2020 Project”, Pittsburgh: Government Printing Office, 2004,http://www.foia.cia.gov/2020/2020.pd f; Het- tne B., Odén B., eds., “Global Governance in the 21st Century: Alternative Perspectives on World Order”, Stockholm: Almkvist & Wiksell International, 2002, http://www.egdi.gov.se/pdf/study/study2002_2.pdf; American Council for the United Nations University, “Global Energy Scenarios. Technology Pushes off the Limits to Growth”, CPB Netherlands Bureau for Economic Policy Analysis, 2006, http://www.acunu. org/millennium/energy-technology.html#this. 2. Studies, which examine characteristics, development and activities of NATO, as well as various political-military security challenges and their possible implications to the Alliance: Hamilton D., Barry C., “Alliance Reborn: An Atlantic Compact for the 21st Century”, Atlantic Council of The United States, 2009, http://www.acus.org/files/publication_pdfs/65/NATO-Al- lianceReborn.pdf; Larrabee F., Lindley-French J., “Revitalizing the Transatlantic Security Partnership: An Agenda for Action”, Venusberg Group and Rand Corporation, 2009, http://www.rand.org/pubs/reprints/2009/ RAND_RP1382.pdf; Cebrowski A., Lanxade J., “NATO Transformation: Problems and Prospects”, Atlantic Council of The United States, 2004, http://www.acus.org/docs/0404-NATO_Transformation_Problems_Pros- pects.pdf; Naumann K. et al., “Towards a Grand Strategy for an Uncertain World: Renewing Transatlantic Partnership”, Noaber Foundation, 2007, http://www.csis.org/media/csis/events/080110_grand_strategy.pdf; Korteweg R., Podkolinski R., “New Horizons: Finding a path away from NATO’s de-solidarisation”, The Hague Centre for Strategic Studies, 2009, http://www.natonewhorizons.org/NewHorizons-DigitalEdition. pdf; Allied Command Transformation, Multiple Futures Project Final Report, 2009, http://www.act.nato. int/media/Multiple_Futures/20090503_MFP_finalrep.pdf. 64

Threats posed by Threats posed by organized crime and Threats posed by Asymmetric threats alternative centers of socio-economic problems “rogue” states power quences forthesecurityof Alliance. regional ethnic-religiousconflicts;however, itdoesnothavedirectconse - Rapidpopulationgrowthandintensiveurbanizationfrequently leads to security (itisnotconsideredasNATO’s fieldofresponsibility). - Organized crimeisnotconsideredassignificantchallengefor Alliance’s NATO memberstates. - Increasingintensityofpiracyviolateseconomicandenergy interestsof lenge forthesecurityof Alliance. - Failedorfailingstatesareconsideredasasubstantiallyimportant chal NATO agenda. ballistic missilesandotherasymmetricchallengesplayanimportantrolein - Increasingthreatsofcyberattacksfromvariousactors,proliferation active endeavoursoftheinternationalcommunity; weapons ofmassdestruction;theprocessproliferationisrestrictedby - Hostileactorsdonothavetechnologicalandfinancialcapabilitiestouse destruction. - Various non-governmentalactorsattempttoacquireweaponsofmass - Terror attacksagainstNATO membersareconditionallyrare. regarded asthemainthreatstosecurityof Alliance - Terrorism andtheproliferationofweaponsmassdestruction(WMD)are respect toNATO, rapidlymodernizetheirmilitary. implement aggressiveregionalpolicy, useharshpoliticalrhetoricwith - Unpredictablecountries(forexample,Iran)seekforregionalleadership, into capabilitiesneededforsuccessivenuclearattack. not posedirectmilitarythreatstoNATO, however, theyintensivelyinvest - Unstablenuclearcountries(NorthKorea,Pakistan,eventually–Iran)do power bystrengtheningtheirconventionalandnuclearmilitarycapabilities. - Alternative centers(China,India,etc.)seekformoreregionalandglobal “zones ofinfluence”,itisoftenincompatiblewithNATO interests. - Regionalpowers(Russia,China,etc.)usevariousmeanstoexpandtheir - Alternative structuresaremilitarilyweakerandnotintegratedpolitically. direct militarythreattothe Alliance. zation –CSTO, ShanghaiCooperationOrganization –SCO)donotpose - Alternative political-militarystructures(CollectiveSecurity Treaty Organi - - - 65

- The effects of climate change lead to increasing tension in the Arctic region. There is a discussion within the Alliance about eventual forms of NATO engagement in the Arctic. - The competition between states over energy resources is increasing. - Certain non-NATO countries use energy resources as a means for political pressure of other states. - Climate change implications for NATO security are not clear; increasing shortages of energy resources are considered as important security challenge for the Alliance. impact of climate change Lack of resources and negative

- One of the most important principles of US foreign policy – close cooperation and sharing responsibility with partners. - US needs the Alliance as a structure, which allows to restore the trust of partners and international prestige. - US considers NATO as a security structure, which ensures the strength of transatlantic cooperation and guarantees the principle of indivisible security. - Without the support of NATO partners, the US would be unable to succeed of NATO in Afghanistan operation, which is the priority of US foreign policy. - US often emphasizes commitment to the principles of collective defence and indivisible security. US disinterest in the efficiency

- Members of the Alliance have different opinions with regard to various items in NATO agenda: enlargement policy, strategy of missile defence, conventional threats to the Alliance, relations with Russia, etc. - Tension within the Alliance is increasing due to disproportionate burden- sharing in international operations. - The decision making process within the Alliance is impeded by the conflict

NATO members NATO between Turkey and Greece. Disagreements between

- Economic and political integration of the European Union (EU) is successful; however, the EU remains an actor of divided sovereignty in the field of

defence policy. - CSDP attempts to be more autonomous from the Alliance; however, the EU remains incapable to conduct high-scale crisis response operations. - The majority of the EU states lack of critical military capabilities (for example, strategic lift). - Partial structural overlap between NATO and CSDP: countries often assign the same capabilities to both organizations. - CSDP is constantly strengthening operational planning capabilities. Evolution of CSDP as Evolution of CSDP - The cooperation is based on Berlin+ arrangements (these arrangements the counterbalance to NATO grant the EU access to NATO planning resources for EU-led operations). 66 2.2. NATO security measures

NATO security measures are dependent variables, which can obtain different values and are the basis of the content of each scenario. Comprehensive analysis of various NATO activities reveals five main NATO security measures: (1) the development of conventional and nuclear military capabilities; (2) the development of “asymmetric” capabilities; (3) the development of civilian capabilities; (4) policy of partnerships and enlargement; and (5) intensity and spectrum of operations.

Table 2. Dependent variables – NATO security measures17

- Conventional military capabilities play an important role in the security strategy of the Alliance. The main purpose of NATO is to ensure credible collective defence; deterrence strategy plays a crucial role in NATO security posture. - Effective deterrence is ensured not only by extensive conventional military power, integrated military structure, effective operational planning system, integrated air defence system, but also by large nuclear arsenal (including US nuclear presence in Europe). - Such instruments as NATO security investment program are used to develop infrastructure within NATO (air and seaports, communications, etc.).

military capabilities - NATO currently does not consider territorial defence as a priority; for the past several years, operation in Afghanistan is a top priority. - NATO officially declares commitment to limit the proliferation of WMD; however, it has no ability to influence the process of non-proliferation con- Development of conventional and nuclear siderably.

- Development of mobile and multifunctional (i.e. able to conduct various

tasks of reconstruction, stabilization, evacuation, etc.) forces is one of the main priorities of the Alliance: NATO seeks to be ready to react rapidly to various asymmetric security challenges. - Considerable attention is devoted to strengthening antiterrorist capabilities (Part- nership Action Plan against Terrorism; Defence against Terrorism Program; etc.). - Cyber defence capabilities are developed; special attention is paid to the security of critical information systems and coordination of actions.

capabilities - Possible role of the Alliance in the field of climate change is discussed (specifically, with respect to eventual NATO’s engagement in the Arctic region) - Eventual forms of NATO’s involvement in energy security issues are discussed within the Alliance (information and intelligence fusion and sharing; Development of “asymmetric” advancing international and regional cooperation; supporting the protection of critical infrastructure; etc).

17 The status quo of NATO security measures is described in accordance with: (1) key NATO documents (1949 North Atlantic Treaty; 1999 NATO Strategic Concept; 2006 Comprehensive Political Guidance; 2009 Declaration on Alliance Security, etc.); (2) declarations and statements of NATO Heads of State and Government, as well as Ministers of Foreign Affairs and Defence; speeches by NATO Secretary General; (3) committee reports by NATO Parliamentary Assembly; official NATO publications. 67

- One of the main operational priorities of the Alliance (specifically in Afghanistan) – the ability to coordinate actions with other international and non-governmental organizations. NATO is developing a comprehensive approach (integrating various civilian and military measures, as well as focusing on close cooperation with other actors), which becomes one of the most important elements of NATO strategy in the operations. - The Alliance itself does not possess civilian capabilities, which are needed for reconstruction operations. NATO basically focuses on ensuring security (as well as training local forces), while reconstruction is more a function of other capabilities actors (United Nations, World Bank, non-governmental organizations, etc.). - NATO basically does not possess capabilities designed to influence socio-

Development of civilian economic development of politically and economically weak states (law enforcement missions; economic and humanitarian aid; social and educa- tional programs; energy, economic, infrastructure projects; prevention of disease; etc.)

- The Alliance has developed a wide network of various partnerships: Partnership for Peace, Euro-Atlantic Partnership Council, NATO-Russia Council; NATO-Ukraine Commission, NATO-Georgia Commission, Medi- terranean Dialogue, Istanbul Cooperation Initiative. The development of cooperation and dialogue policy is considered by the Alliance as one of the most important measures in order to expand security/stability zone, based on common values, mutual trust and transparency. Partnerships are seen as an instrument to prevent new sources of instability. - On the other hand, NATO has not developed extensive political cooperation with such actors as China or India, substantial cooperation with such actors as African Union or Organization for Security and Cooperation in Europe. The relations with the UN are often disturbed by many political and and enlargement procedural problems. Certain NATO partnership programs (for example, Policy of partnerships Istanbul Cooperation Initiative) are more declaratory and lack substance. - NATO-EU relations are often based on competition rather than cooperation (many procedural problems). - For the past several years NATO has pursued intensive enlargement policy – seven states became members of the Alliance in 2004; two (Albania and Croatia) – in 2009.

- NATO for the past several years has been engaged in large scale operation in Afghanistan (ISAF) and Kosovo (KFOR). NATO is also conducting counter-piracy operation off the Horn of Africa, NATO Training Mission in Iraq, antiterrorist naval operation Active Endeavour in the Mediterranean spectrum Sea. Besides, the Alliance continues to support the African Union in its Intensity and of operations peacekeeping missions. 68 2.3. NATO transformation scenarios

Each scenario will be presented and assessed as follows: firstly, the characteristics of NATO’s strategic environment and Alliance itself (independent variables) will be shortly presented and generalized. Secondly, the tables with the configurations and values of independent and dependent variables will be provided. Finally, the content of the scenario will be unfolded by elaborating the characteristics of each dependent variable.

2.3.1. Scenario A: NATO as a global mechanism for crisis management

This scenario is characterized by a strong intensity of the “postmodern” security challenges (+6), effective internal interaction within the Alliance (-4; US and European states in this scenario are interested in efficiency of the Alliance) and basically insignificant set of “modern” challenges (-2). Such a configuration determines high intensity of dependent variables (four out of five NATO security measures have the value of +2, i.e. the highest intensity within the analytical framework of this article). In other words, high intensity of “postmodern” security challenges determines the need of wide spectrum of security measures, which is “enabled” by the absence of internal problems. In accordance, NATO focuses on development of rapid response force, as well as stabilization and reconstruction capabilities.

Table 3. The configuration of independent variables in scenario A +2 +1 0 -1 -2 A „Modern” security A challenges A „Postmodern” A security challenges A A A Internal NATO A asymmetry A

Table 4. The values of dependent variables in scenario A +2 +1 0 -1 -2 Conventional A capabilities „Asymmetric” A capabilities Civilian capabilities A Partnerships and A enlargement Intensity of operations A 69

1. The importance and development of conventional and nuclear military capabilities. “Modern” security challenges in this scenario are not relevant for the security of the Alliance; therefore, conventional military capabilities lose their importance. Russia is considering NATO as an important partner and does not seek to expand its influence in neighbour countries. Military actions are not used to solve interstate problems. Alternative centres of power (large countries and political-military structures) commit to reduce nuclear arsenal, the importance of “zones of influence” in international relations is decreasing. “Rogue” states do not pose direct threat to the Alliance; however, they intensively develop weapons of mass destruction, demonstrate hostility to NATO countries and reject various disarmament and confidence building mechanisms. In light of such a security environment, the Alliance, though retains nuclear arsenal (needed for effective deterrence), does not invest considerably into static infrastructure (required for collective defence) and heavy weaponry. On the other hand, much attention is devoted to the development of the missile defence system, which can assure partial defence from intercontinental ballistic missiles. Also, maritime capabilities play an important role in NATO defence posture – the Alliance is increasing its role in the field of ensuring safe transfer of energy resources (securing sea-lanes) and defending NATO interests in the areas of new territories, which become available for the navigations due to the climate change (for example, the Arctic). Article 5 commitments formally remain; however, they are not strengthened. The expeditionary character of the Alliance and non-existence of conventional security challenges lead to the “diffusion” of the Article 5, which is seen only in the light of asymmetric security challenges. 2. The meaning and development of “asymmetric” capabilities. Va- rious asymmetric challenges pose the most acute threat for the Alliance in this scenario: terror attacks against NATO countries, well organized network of transnational terrorism, uncontrolled proliferation of WMD, attacks against NATO computer systems, etc. In accordance, the Alliance focuses on the development of multifunctional rapid response force. NATO countries fill all the gaps of capabilities, which are needed for effective expeditionary operations. Sophisticated defensive and offensive cyber capabilities are developed, NATO also devotes a lot of attention to the prevention of biological and chemical terrorism, as well as preparation to neutralize the consequences in case of such attacks. The Alliance develops a doctrine of preventive military actions and strengthens its role in the field of securing critical objects of energy and other infrastructure. 3. The importance and development of civilian capabilities. Rapid growth of population and intensive urbanization leads to regional ethnic-religious conflicts, which have complex socioeconomic consequences. Frequent disarray of energy supply, as well as a lack of critical resources raises many political problems for the countries, which import resources from unstable regions. 70

In response to these challenges, NATO is rapidly developing civilian capabilities. The Alliance acquires various political, economic and diplomatic instruments, which enable NATO to influence countries, which are negatively affected by the lack of resources and demographic problems. NATO creates an integrated crisis management system, which contains various instruments of stabilization and reconstruction (specific programs of law enforcement, good governance and education; economic and humanitarian aid, etc.). Their implementation is closely coordinated with other international organizations. The Alliance thus can effect socioeconomic development of unstable regimes and thus prevent their eventual transformation into failed states. 4. The policy of partnerships and enlargement. A wide spectrum of security challenges leads to a wide network of NATO partnerships. Close cooperation with partners (Australia, South Korea, New Zealand, Japan, etc.) is maintained, the limits between NATO members and strategic partners are vanishing; partner countries are involve in the decision making process and financially contribute to NATO operations and programs. There are basically no limits for NATO enlargement to the post-soviet space and the Balkan region. Much attention is devoted to the geo-strategically important countries (from the perspective of supply or provision) – the Alliance seeks to ensure the stability of these countries, various forms of cooperation and assistance are used for this purpose. The prevention of nuclear proliferation becomes one of the key elements of NATO‘s external policy. Various countries and organizations are involved into global strategy of stopping the spread of WMD, various commitments to non-proliferation become essential part of NATO partnership programs. Many actors of international politics are involved in counter-terrorism activities and fight against organized crime, as well as climate change and “rogue” states. NATO coordinates its policy with regional powers (China, India, Russia, Brazil, Pakistan, etc.). 5. The intensity and spectrum of operations. NATO has a global agenda in this scenario; operations are conducted in various regions. The Alliance not only devotes much attention to the counter-terrorism operations, but is also engaged in the missions of stabilization, reconstruction, peace keeping, conflict prevention, humanitarian aid, etc.

2.3.2. Scenario B: NATO as a fortress of collective defence

“Modern” threats dominate in this scenario (+5, aggressive foreign policy of Russia, increasing importance of power politics in international relations), “postmodern” challenges are not intense (-3), there are basically no problems in terms of internal interaction in the Alliance. Such a configuration determines intensive strengthening of NATO’s collective defence. Conventional military capabilities and nuclear deterrence measures play essential role (+2), whereas the intensity of all the other dependent variables is low – the Alliance’s functi- 71 ons are basically limited to collective defence. The US retains its interest in the security of Europe. NATO as a structure of collective security remains crucially important for European countries.

Table 5. The configuration of independent variables in scenario B +2 +1 0 -1 -2 B „Modern” security B challenges B B „Postmodern” B security challenges B Internal NATO B asymmetry B B

Table 6. The values of dependent variables in scenario B +2 +1 0 -1 -2 Conventional capabilities B „Asymmetric” B capabilities Civilian capabilities B Partnerships and B enlargement Intensity of operations B

1. The meaning and development of conventional and nuclear military capabilities. Conventional military threats are essential for the security of the Alliance in this scenario. Due to regular Russian military provocations and the use of military power against NATO partners, there is a potential military conflict between Russia and NATO. Russia does not follow international agreements in the field of arms control and nuclear disarmament. Other actors (China, India) intensively develop political-military blocs, which strengthen their influence in the “zones of influence”; the principles of territorial integrity are often violated. The military potential of the alternative structures is rapidly growing. The situation in international politics is also complicated by aggressive states (Syria, Iran, North Korea), which possess WMD and have technical abilities to use them against NATO. Such a geostrategic environment leads to a situation, where the security of the Alliance is largely dependent on the effectiveness of deterrence and the capabilities of collective defence. NATO strengthens its nuclear arsenal (high readiness is maintained permanently), the programs of medium and short range ballistic missiles are pursued, considerable investments are made in heavy armament, integrated air defence system, strategic bombers, nuclear submarines, etc. 72

Much attention is devoted to the development of the missile defence system and host nation support capabilities. Large scale Article 5 exercises are regularly conducted; NATO creates various mechanisms of increasing its visibility in member states and improving demonstration of force capabilities. The general defence plan of the Alliance becomes the basis of NATO collective defence; the Alliance conducts permanent military planning, which elaborates in detail eventual response of NATO in case of external aggression. 2. The meaning and development of “asymmetric” capabilities. Asym- metric security challenges are not relevant to the Alliance in this scenario. The threat posed by terrorism is rather low, various terrorist organizations are not well organized, do not have technical ability to make considerable damage (usually are unable to overcome NATO security systems), act chaotically and do not possess WMD. Demographic processes do not have direct implications for the security of the Alliance. NATO, though retaining rapid response capability, does not consider the development of “asymmetric” capabilities as a priority. On the other hand, cyber defence capabilities are developed rapidly due to frequent cyber attacks. 3. The meaning and development of civilian capabilities. Projection of security (capabilities of stabilization, reconstruction, etc.) is not an important element of NATO functional model in this scenario. The Alliance does not develop “soft” capabilities, which could ensure the ability to influence socioeconomic transformation of various countries. 4. The policy of partnerships and enlargement. Some NATO countries are objecting wide functional and geographic spectrum of NATO activities. In the light of increasing importance of power politics and conventional military threats, NATO is not developing its network of partnerships. Closer cooperation is maintained with the most important strategic partners only (Australia, Japan, and South Korea), while relations with other countries and partners lack substance (no coordination of political decisions or common military projects). NATO enlargement is very much limited by the aggressive Russian foreign policy in its “zone of influence”. 5. The intensity and spectrum of operations. NATO concentrates its attention to the efficiency of collective defence and deterrence; therefore, large- scale expeditionary operations beyond Euro-Atlantic area are not conducted. NATO is capable to perform small-scale counter-terrorism operation in various regions; however, it is not ready to engage in long-lasting missions, especially if civilian capabilities are needed.

2.3.3. Scenario C: NATO as a paralyzed political forum

Various “postmodern” threats are the most relevant in this scenario (+4); therefore, there is a need to develop asymmetric and civilian capabilities. Howe- ver, high asymmetry within NATO (+3; CSDP is developed as a counterbalance to NATO; transatlantic link is weak; US foreign policy becomes unilateral) para- lyzes the ability to develop necessary capabilities. Conventional military power is 73 not strengthened (-2) due to minimal intensity of “modern” challenges (-5). In this scenario, NATO is inefficient despite US interest in the efficiency of the Alliance. NATO is functioning more or less properly only as a political forum.

Table 7. The configuration of independent variables in scenario C +2 +1 0 -1 -2 C „Modern” security C challenges C C „Postmodern” C security challenges C Internal NATO C asymmetry C C

Table 8. The values of dependent variables in scenario C +2 +1 0 -1 -2 Conventional C capabilities „Asymmetric” C capabilities Civilian capabilities C Partnerships and C enlargement Intensity of C operations

1. The meaning and development of conventional and nuclear military capabilities. Conventional capabilities are not developed due to radical change in Russian attitude towards NATO. Russia not only considers the Alliance as an important partner, but also initiates various forms of cooperation. The atmosphere of trust in international relations is also strengthened by cooperative behaviour of other centres of power. The atmosphere of cooperation determines a “freeze” of NATO collective defence. Though the validity of Article 5 formally remains, it is not supported by sufficient military capabilities, operational planning, integrated air defence and political commitments. In the light of intensive nuclear disarmament, NATO’s nuclear capability looses it relevance. As a result of the pressure by European countries, the US withdraws its nuclear arsenal from Europe. NATO military structures are transformed into low readiness weakly integrated system of commands, which are rarely used. The Alliance does not modernize its heavy armament; no common acquisition projects are pursued; no investments in host nation support capabilities are made. NATO becomes a political forum, which 74

(usually not represented in the highest political levels) is used for discussions about global security problems. It has however no sufficient practical measures to influence the situation. 2. The meaning and development of “asymmetric” capabilities. In terms of asymmetric security challenges, the geostrategic environment is extremely complicated in this scenario. Security situation is complicated by a wide network of terrorist structures, ill-controlled proliferation of WMD, frequent cyber attacks. Many problems are posed by the failed states. Despite these challenges, internal problems within the Alliance lead to a paralysis of the development of asymmetric capabilities. NATO’s rapid response force, designed for various asymmetric functions, exists only formally. Practically, it lacks critical capabilities, which are necessary for operational efficiency. Instead of developing NATO abilities, European states distribute their resources and capabilities via more efficient CSDP structures. 3. The meaning and development of civilian capabilities. In this scenario, only CSDP possess civilian capabilities, NATO does not have any means of civilian effect. In accordance with complicated decision making mechanism and absence of activities beyond Euro-Atlantic area, NATO’s cooperation with other international actors and organizations is rather passive. NATO’s reaction to the problems generated by the lack of resources and climate change is limited to political declarations. 4. The policy of partnerships and enlargement. Partnerships are the only conditionally effective policy of the Alliance. Various forms of NATO partnerships are transformed into political forums, which are used for discussions about international security challenges. The number of practical cooperation forms is decreasing – the Alliance does not practically contribute to the modernization of partners’ defence sector, almost no events of common exercises and training are organized, etc. The enlargement of NATO is stuck as countries cannot find a consensus about eventual directions of enlargement. 5. The intensity and spectrum of operations. Disagreements within NATO and the military weakness of the Alliance (poorly integrated military structure and lack of necessary resources) lead to an inability to engage in the operations outside NATO borders.

2.3.4. Scenario D: NATO as a multifunctional security structure

In terms of the characteristics of the security environment, this scenario is a mix of scenarios A and B, i.e. not only “modern” (+3), but also “postmodern” (+4) security challenges are relevant to the Alliance. Hence, it is the only scenario, in which the development of conventional, as well as civilian and asymmetric capabilities is needed. Internal structural dynamics of the Alliance is very favourable (-5). The characteristics of geostrategic environments determine a need not only to develop intensively conventional military capabilities (the probability of war with Russia is high), but also to focus on strengthening the 75 expeditionary arsenal (the threat posed by terrorism is eminent). In accordance, NATO faces a complex problem of operational and financial overstretch.

Table 9. The configuration of independent variables in scenario D +2 +1 0 -1 -2 D „Modern” security D challenges D D „Postmodern” D security challenges D D Internal NATO D asymmetry. D

Table 10. The values of dependent variables in scenario D +2 +1 0 -1 -2 Conventional capabilities D

„Asymmetric” capabilities D

Civilian capabilities D Partnerships and D enlargement Intensity of operations D

1. The meaning and development of conventional and nuclear military capabilities. Aggressive Russian foreign policy directly affects security of the Alliance. NATO also faces a threat of WMD attacks from aggressive and unpredictable countries (Syria, Iran, etc.). The danger of military conflict with Russia determines the strengthening of NATO’s collective defence posture – high readiness of nuclear weapons is maintained, missile defence system is intensively developed, the principles of territorial integrity are reflected in the planning and exercising of the Alliance, as well as in its military structure and integration. In order to be able to neutralize eventual attacks by the “rogue” states, NATO devotes much attention to the development of preventive capabilities. 2. The meaning and development of “asymmetric” capabilities. The characteristics of the strategic environment determine the need to have effective mechanisms, which would enable the Alliance to address various asymmetric challenges effectively. NATO devotes much attention to the development of multifunctional rapid response force and various counter terrorism measures. Offensive and defensive cyber capabilities play an important role in NATO agenda; the Alliance is preparing to neutralize consequences in case WMD attack. Protection of energy transportation routes and critical infrastructure is an important element of NATO strategy in this scenario. Due to the intensity 76

of climate change, newly available energy resources increasingly become the cause of conflict and competition between the states. Therefore, the Alliance develops specific military capabilities, allowing them to engage in the process of regulating these conflicts. The biggest suppliers of energy resources are using them for aggressive foreign policy. A fluent supply of the resources is therefore a very relevant topic in NATO agenda. 3. The meaning and development of civilian capabilities. The Demograp- hic situation and climate change have complex socioeconomic consequences, which have direct implications for the security of the Alliance. In this scenario, European countries become a driving force of the development of civilian dimension (CSDP is weak, civilian resources are therefore distributed via NATO structures). 4. The policy of partnerships and enlargement. The policy of partnerships is an important element of NATO strategy in this scenario. On the other hand, the spectrum and efficiency of partnerships, as well as the enlargement policy is very much limited by conflict with Russia. NATO is maintaining close relations with its strategic partners, as their support is very important for the Alliance in the field of counterterrorism, proliferation of WMD, organized crime, etc. NATO and the EU are closely coordinating on the decision making process and create interoperable defence planning systems. 5. The intensity and spectrum of operations. The Alliance is capable of conducting small-scale operations of stabilization, evacuation, etc. At the same time, considerable attention to the collective defence capabilities leads to a situation, when NATO is not able to engage in large scale long-lasting reconstruction operations, which require a lot of resources. The Alliance is ready to use preventive military action against aggressive states and non-state actors, possessing weapons of mass destruction.

Conclusions and a View from Lithuania

By summarizing the scenarios, it could be claimed that the need for certain NATO security measures is determined by the international security challenges, while internal factors (the strength of the transatlantic link, internal disagreements within NATO, the evolution of the CSDP as a counterbalance to NATO) define the potential to implement certain security measures and ensure their efficiency. The scenarios, which were constructed in this article, give an opportunity by using identified independent variables and the results of their interaction, to answer the question under which scenario the transformation of Alliance is currently proceeding. In the short term (1-3 years), the intensity of the “modern” security challenges is likely to increase in the light of: (a) increasing Russian military activity, political and economic penetration into neighbour states, based on the doctrine of “exclusive zone of influence”; support for the countries, which are hostile to the Alliance; (b) increasing role of alternative centres of power 77

(growing importance and political integrity of such structures as the CSTO); increasing geopolitical ambitions of China, India and Brazil in the international politics (collision with the interests of the Alliance is expected); (c) increasing threat to the Alliance, posed by unpredictable aggressive countries (Iran, North Korea, Syria, and eventually – Pakistan). The intensity of “postmodern” challenges is also likely to increase because of the following reasons: (a) in the light of current geostrategic situation (instability in the Afghanistan and Pakistan), the importance of asymmetric threats (terrorism and the proliferation of WMD) will certainly increase; (b) the expansion of transnational organized crime (trafficking of humans and drugs), as well as piracy is likely to rise; rapid growth of population, migrations and urbanization will probably also have security implications for the Alliance; (c) the process of climate change will certainly have consequences for NATO, firstly, in the Arctic region; complex problems generated by the lack of critical resources will impact NATO countries directly. With respect to the internal dynamics within the Alliance, it could be forecasted that: (a) in accordance with the politics of current US administration, the US interest in the efficiency of the Alliance will not decline; (b) new tangible disagreements between NATO members are not likely. On the other hand, (c) the autonomy of the CSDP (firstly, in terms of developing independent operational planning capabilities) is likely to increase gradually – it may have negative implications for the security of the Alliance. These tendencies for the short period in many respects correspond to the configuration of the independent variables in the scenario D. If such tendencies remain the same, in the long term perspective (10-15 years), further transformation of the Alliance will proceed namely on the basis of scenario D (NATO as a multifunctional security structure). It is important to notice that some of the features of current NATO activities, as well as some elements of the Alliance‘s short term strategy do not correspond to the pattern of development, which is forecasted in scenario D. For example, current strong commitment to continuing the operations in Afg- hanistan indicates increasing operational tempo of the Alliance, meanwhile, the scenario D projects opposite tendencies. It must therefore be stressed that the added value of the scenario building is namely the opportunity to identify those tendencies, which would remain unconsidered if the analysis was limited to examination of the Alliance itself. Yet more opportunities for a comprehensive analysis would become available if the independent variables were used as indicators for the monitoring of NATO driving forces during a certain period. Such an observation would allow for identifying even more accurately the direction of NATO’s transformation and formulating respective practical recommendations. The debate regarding the future of the Alliance is especially relevant to the countries which, due to their specific geostrategic situation, consider NATO membership as a fundamentally important element of their security policy. Lithuania certainly is one of such countries. 78

On the one hand, Lithuanian foreign policy makers can be rightfully worried about the suggestions to transform the Alliance into the universal crisis management structure and reject all the “relics of the Cold War”, including the principle of collective defence. On the other hand, the official statements and declarations by Lithuanian politicians give the impression that Lithuanian strategic thinking is based on the principles of a “surrounded fortress”: emphasis is frequently put on the need of direct US military presence in the Baltic region, importance for the development of NATO infrastructure in the territory of Lithuania, as well as necessity for NATO exercises on the basis of Article 5 scenario, etc.18 The question of how the implementation of such measures would practically contribute to the security of Lithuania is usually not raised at all. Of course, such a position is not without ground – the increasing aggressiveness in Russian foreign policy during the last several years does not strengthen the sense of security in neighbouring countries; the increased intensity of fierceness in Russian politics was also anticipated by the short term forecast in this article. However, it seems that the main slogans of Lithuanian security policy are not adapted to a changing posture of international security. Unconditional strengthening of a US military presence is not necessarily a conditio sine qua non for successful security policy of Lithuania. On the contrary, under certain circumstances it might be even counterproductive and indicate deterioration of the security situation. Forecasting methods can be seen as a useful tool to stimulate innovative political (as well as academic) thinking. Scenario building can be used as a methodological device for the systematic reflection of NATO strategic environment. In turn, it would give an opportunity to evaluate the transformation of the Alliance and allow regular renewal of Lithuanian strategy for NATO.

October-November, 2009

18 Symptomatic examples – Seimas of the Republic of Lithuania, Nutarimas dėl Lietuvos Respublikos Vy- riausybės programos, 2008 12 09, Nr. XI-52, Vilnius; Seimas of the Republic of Lithuania, the Statement Adopted by the Committee on Foreign Affairs with Regard to New NATO Strategic Concept, http://www3. lrs.lt/pls/inter/w5_show?p_r=6430&p_d=91187&p_k=1, 2009 10 09 Changing European Security Space

Martynas Lukoševičius* Ministry of Foreign Affairs of the Republic of Lithuania**

European Union Sanctions Policy

This article analyses the sanctions policy conducted by the European Union and names it one of the most frequently used instruments of its foreign policy. It also shortly encompasses the sanctions imposed to the third countries by the EU, putting a special emphasis on the restrictions to the states not subject to the United Nations sanctions. The article concludes that, despite the active usage of the sanctions instrument by the EU, they can be assessed as a political signal to a target country but without any concrete impact on its internal or external policies. A long list of sanctioned country over time corresponds to this conclusion. The article describes the Lithuanian policy in implementing the sanctions as well as states that there is no national legislation in Lithuania in order to impose unilateral sanctions.

Introduction

The Charter of the United Nations states that, “the parties to any dispute, the continuance of which is likely to endanger the maintenance of international peace and security, shall, first of all, seek a solution by negotiation, enquiry, mediation, conciliation, arbitration, judicial settlement, resort to regional agencies or arrangements, or other peaceful means of their own choice”1. In case of a conflict, the United Nations Security Council decides what non-military measures are to be employed to restore international peace and security2. This provision of Article VII of the Charter legitimizes international sanctions as an instrument of international politics. Sanctions can be treated on an international level when they are imposed by international or regional organizations, so it is obvious that the Member States of the European Union (EU) imposed sanctions on the EU level, or implement them after the imposition of other international organizations in order to coordinate their foreign policy. However, Lithuania implements the international sanctions imposed by the United Nations (UN), European Union

*Martynas Lukoševičius is a diplomat, since September 2009 he serves as a Third Secretary and the Embassy of the Republic of Lithuania to the Federal Republic of Germany. In 2005-2009 he worked at the Division of Arms Control and Terrorism Prevention of the Transatlantic Cooperation and Security Policy Department of the Ministry of Foreign Affairs of the Republic of Lithuania, tel. +37068247411, e-mail: martynasl@ hotmail.com. ** The views and evaluations expressed in this article are purely those of the writer and may not in any circumstances be regarded as stating an official position of the Ministry of Foreign Affairs of the Republic of Lithuania and its institutions. 1 Article 33 of Chapter VI of the Charter of the United Nations. 2 Ibidem, Article 33 of Chapter VI. 82

(EU) and Organization for Security and Co-operation in Europe (OSCE) but has no unilateral sanctions to any subject. This corresponds to the assessment that sanctions on an international level give more impact and cause less damage to the imposing state than in comparison to unilateral sanctions3. This article aims to describe the international sanctions imposed by the European Union and their issues – the way they echo the sanctions imposed by the United Nations Security Council (further referred as UNSC), the cases of unilateral imposition, and their general efficiency as and instrument of international politics in order to achieve certain goals. The article also seeks to demonstrate that the EU, in comparison to other foreign policy measures, uses the instrument of international sanctions in a effective and abundant way in order to achieve its foreign policy goals despite the fact that the internal negotiations upon their impositions requires much time. Neglecting this detail, the EU sanctions policy can be regarded as one of the most legally and technically determined areas of foreign policy making. We must admit that references about the sanctions issues, especially in Lithuanian, is rather incomplete and it hardly gives any information about the impact of sanctions on a targeted country. One of the more distinguishable Lithuanian authors is jurist Dovydas Špokauskas who chose for his analysis an important topic, i.e. issues of human rights in implementation of international sanctions4. In the absence of a systematic analysis describing current international sanctions implemented by the EU, this article should become a stepping-stone for further research in the sphere of international sanctions, it should also have as well a practical use for those interested in, or working with, the implementation of international sanctions. Before starting to write about the subject of international sanctions, it is advisable to pay attention to the term “sanctions” which in some legislation is replaced by the phrase “restrictive measures” (lith. “ribojančios priemonės”, fr. “mesures restrictives”, germ. “restriktive Maßnahmen”). On the website of the EU Commission5 both terms are treated as synonyms and neither of them has an additional value. Joakim Kreutz provides us with an interpretation as to why these two terms still survive, especially the indirectly comprehensible term “restrictive measures”, giving an idea that the EU treats itself as a “soft power”, therefore its institutions are avoiding the use of stricter terms despite the fact that according to the definition provided by the United Nations, and to the usage by various states, both terms have the same meaning6.

3 Akehurst M., Malanczuk P., Šiuolaikinis tarptautinės teisės įvadas [Modern Introduction To International Law], Vilnius, Eugrimas, 2000, p. 29 (in Lithuanian). 4 Špokauskas D. “Žmogaus teisių apsauga taikant tarptautines sankcijas” [“The Preservation of Human Rights in Implementation of International Sanctions”, Teisė [The Law] 64, 2007 (in Lithuanian). 5 “Sanctions or restrictive measures in force”. (iš http://ec.europa.eu/external_relations/cfsp/sanctions/index_en.htm, 15 12 2009). 6 Kreutz J., Hard Measures by a Soft Power? Sanctions Policy of the European Union, Bonn International Center for Conversion, 2005, http://www.bicc.de/uploads/pdf/publications/papers/paper45/paper45.pdf, 15 12 2009. 83

For the sake of brevity and clarity in this article, the priority is given to the term “sanctions”, moreover its synonym “restrictive measures” in Lithuanian seems to be a literal translation from foreign languages.

1. International Sanctions: Types, Objects and Scope

The Law of the Implementation of Economic and Other International Sanc- tions of the Republic of Lithuania7 provides us with an explicit list of the main types of international sanctions: economic, financial, political, communication, and public. It is a logical and definite grouping of international sanctions applicable not only for the Lithuanian practice. The universality of this Lithuanian law could be explained by the fact that Lithuania, before it joined the EU, had no “specific legislation controlling social sphere in case of the state should apply sanctions to other states, informal organizations, legal and natural persons”8. Lithuania’s membership in the EU was led by the requirement to prepare and adopt a national legal act on international sanctions and it created good conditions to accumulate “good practice” of the already EU member states, which were asked to share it as well as to directly take over the EU provisions. This is the reason why Lithuanian legislation suggests a coherent classification of international sanctions and a description of their implementation. One must remark that this law was adopted on 22 April 2004, i.e. just a week ahead of Lithuanian membership in the EU. It is worth remarking that usually economic (arms embargo), financial (freeze of assets), and political (visa ban) sanctions are the most preferred as they could be easier defined and their implementation to be controlled as of relatively vague communication and public sanctions. Economic sanctions refers to restrictions on the import, export, re-export, and transit, including brokering, of goods for civil purposes, dual-use items, military equipment, services, and technologies (in other words – arms embargo); restrictions on the trade with entities with respect to which international sanctions are implemented; restrictions on economic activities of natural and legal persons of the Republic of Lithuania in a state or territory with respect to which international sanctions are implemented; restrictions on economic activities in the territory of the Republic of Lithuania of the entities with respect to which international sanctions are implemented. Radical economic sanctions could be described as a boycott and blockade: the first referring to suspension of any economic relations and the latter meaning the physical isolation of the country that no foreign trade could be conducted9.

7 22 Aril 2004, No IX-2160. 8 Article 3 of Resolution of the Government of the Republic of Lithuania No 1661 “On the Approval of the Conception of the Law on Economic and Other International Sanctions of the Republic of Lithuania” (27 December 2003, Official Gazette 2005, No 122-5528). 9 V. Vadapalas provides with an example of Iraq which, after the invasion to Kuwait in 1990, was a subject of economic boycott and blockade according to UNSC resolutions No 661 (1990) and 665 (1990). According to Vadapalas V., Tarptautinė teisė: bendroji dalis [International Law: Common Part], Vilnius: Eugrimas, 1998, p. 348 (in Lithuanian). 84

Financial sanctions refers to restrictions on the rights of entities, with respect to which international sanctions are implemented, to manage, use and dispose of cash, securities, goods, other assets and property rights; payment restrictions for entities with respect to which international sanctions are implemented; other restrictions on financial activities. It is worth noticing that financial sanctions do not lead to the deprivation of the assets of persons subject to sanctions but forbid for a certain period to use them and profit. Political sanctions refers to restrictions on official visits; restrictions on entry into, or transit through, a state or a territory with respect to which international sanctions are implemented; restrictions on entry into, or transit through, the territory of the Republic of Lithuania for the persons with respect to whom international sanctions are implemented; restrictions on diplomatic relations; other measures of political and diplomatic influence. Rarely used communication sanctions are described as restrictions on transport (rail, road, water, air), postal, electronic, and (or) other communication with entities with respect to which international sanctions are implemented. Lastly, public sanctions refer to restrictions on cultural, scientific, edu- cational, sports, and other public relations with entities with respect to which international sanctions are implemented. The objects of international sanctions can be states, natural and legal persons and other subjects whose actions, decision or current policy violate human rights, contribute to ethnic, territorial and religious conflicts, promote terrorism or by any other way breach the core norms and principles supported by international community. The objects can include representatives of national governments, companies producing strategic goods (arms), logistic companies, certain banks or sensitive industry branches in various countries (e.g. diamonds in Liberia and timber in Myanmar). International sanctions could be also determined and regarded as measures of non-military impact that aim to change the current policy of certain countries, its government or of its part, other subjects and persons and stop concrete activities breaching the norms of international law. The implementation of international sanctions is based not on the economic interests but on the principles of international law, democracy, respect for human rights and principal freedoms. For instance, the EU when implementing the sanctions imposed by other international organizations or imposing on its own refers to Article 6 of the Treaty on European Union declaring that “the Union shall respect fundamental rights, as guaranteed by the European Convention for the Protection of Human Rights and Fundamental Freedoms signed in Rome on 4 November 1950 and as they result from the constitutional traditions common to the Member States, as general principles of Community law”10. The same level of importance is accredited to the principles of propor- tionality and expediency, which are regarded when sanctions are targeted to

10 Article 6 of the Treaty on European Union. 85 subjects responsible for current policy and concrete activity but not to the entire population of a sanctioned country11. On imposition of sanctions, the scope is defined in details: in case of arms embargo concrete lists of goods or technologies forbidden to export shall be drawn up, as well as a period for termination of sanction or their revision shall be foreseen. Separately, certain exceptions on the applicability of sanctions are emphasized and their concrete circumstances, as well as institution in charge of their implementation are set out. Exceptions usually cover the use of frozen assets for humanitarian aims (provision of food and medicine), cost of legal proceedings; in case of arms embargo military equipment are allowed to be exported to UN missions or to provide diplomatic representations or journalists with protection equipment.

2. The Implementation of International Sanctions in the European Union

The European Union being an international organization joined by 27 states adopts legislation on the implementation of international sanctions binding its member states. The major part of these sanctions were adopted by the United Nations Security Council and the EU simply transposes them to the legal system of the Community – certain types of the legislation of the Community define their scope and the level of obligation to implement. In some cases the EU has specific foreign policy aims and adopts additional, so-called autonomic sanctions, which are applied only by member states. This chapter describes common issues revolving around the adoption and implementation of EU sanctions and these two types thereof: the sanctions transposed by the EU and its autonomic ones.

2.1. Basic Principles of the Sanctions Applied by the EU

The EU sanctions policy is regarded as one of the instruments of the Common Foreign and Security Policy (CFSP), which can be used by the Com- munity in implementation of its objectives enlisted in Article 11 of the Treaty on European Union12:

11 Sometimes these specifically targeted sanctions are entitled as “smart sanctions”. According to Evans M., ed., International Law, 2nd Editon, Oxford University Press, 2006, p. 529. 12 Article 11 of the Treaty on European Union. The adoption and implementation of sanctions are set out in details in the following specific EU documents: 1) Basic Principles on the Use of Restrictive Measures, 2) Guidelines on Implementation and Evaluation of Restrictive Measures in the Framework of the EU Common Foreign and Security Policy, 3) EU Best Practices for the Effective Implementation of Restrictive Measures (these document are available on the Website of the EU Commission http://ec.europa.eu/external_relations/ cfsp/sanctions/index_en.htm, 15 12 2009). 86

• To safeguard the common values, fundamental interests and independence of the Union; • To strengthen the security of the Union and its Member States in all ways; • To preserve peace and strengthen international security in accordance with the principles of the United Nations Charter, as well as the principles of the Helsinki Final Act, and the objectives of the Paris Charter; • To promote international cooperation; and • To develop and consolidate democracy and the rule of law, and also respect for human rights and fundamental freedoms. The sanctions in force must be applied to targeted objects in sanctioned countries without breaching the interest of citizens and companies of these countries; the applied measures must not have impeded the agreements of the World Trade Organization (WTO) as well. To these ends, the lists of sanctioned persons shall be compiled, including their accurate identification details, conditions and procedures of their enlisting and de-listing. Freezing of assets shall have its validity period, as well as arms embargoes shall be applicable only for the equipment included in control lists. These principles of the EU should lead to greater political transparency and legal clarity with special attention to the respect of human rights. Lately some people coming from third countries have started legal proceedings13 in order to prove that they have been arbitrarily included into the list of sanctioned persons. To avoid such cases, there is a trend at the stage of sanctions adoption to submit all available proofs on criminal acts of such individuals and even to set out these proofs in the EU legislation14. It is also important to emphasize that the Union does not adopt any legislation with exterritorial applicability, i.e. biding the citizens and subject of third countries, on its assumption that it impedes the international law. On these grounds it also denounces such legislation of other countries and foresees appropriate sanctions on third countries if their legislation has an exterritorial applicability over these natural and legal persons of the EU member states15. Implementing international sanctions adopted by the United Nations

13 E.g. Case T-256/07 of the Court of First Instance of the European Union where the entity “People’s Mojahedin Organization of Iran” attempted to prove that it was unjustified subjected to sanctions. Other example denotes Case T-85/09 of Yassin Abdullah Kadi versus the EU Commission. This person claimed about arbitrary inclusion to the sanctions list: neither appropriate UN decision nor circumstances to defend himself and submit vindication were provided, as well as the Commission has not presented reasons for freezing of his assets. He has also claimed that Regulation (EC) No 1190/2008 imposing sanctions upon him was appropriately applied to restrain his ownership proportionally. 14 E.g. Council Common Position 2008/652/CFSP amending Common Position 2007/140/CFSP concerning restrictive measures against Iran provides with list of sanctioned individuals where the reasons of their enlisting are also available. 15 E.g. Council Regulation (EC) No 2271/96 of 22 November 1996 protecting against the effects of the extra-territorial application of legislation adopted by a third country, and actions based thereon or resulting therefrom. 87

Security Council and according to Article 15 of the Treaty on European Union16, the EU Council adopts common positions setting out political obligations for member states to implement certain sanctions. In this case, member states shall adopt national legislation implementing common positions. In areas where the Union possesses its exclusive competence, additional regulations having direct applicability are also adopted. The exclusive competence of the Union embraces trade restrictions, prohibition to provide with assistance, and freezing of assets. On the other hand, embargo on military equipment and visa ban remains within the competence of member states as a part of CFSP. Common positions set out all sanctions imposed to certain subjects, even if some of them are included into regulations. In order to avoid any tran- sitional period when member states have to implement sanctions according to common positions, including those of the exclusive competence of the Union, appropriate regulations are usually adopted at the same time as in practice their contents do not drastically diverge from each other and both documents are prepared in common. In order to append the sanctions imposed by common positions and regulations, the Council is empowered to adopt limited scope decisions, for instance, on inclusion of new individuals into visa ban lists, as well as the Commission can adopt regulations on inclusion of individuals into lists of asset freezing. Specific measures to implement sanctions shall be adopted on a national level but in cases where no directly applicable regulations are adopted (i.e. in cases of common positions only), some states decide to implement common positions directly on the national level. Moreover, competent national authorities are always entitled to impose penalties in case of infringement of sanctions regime, grant exceptions, as well as exchange of information and submit national reports on implementation. In some cases it is not true that regulations of direct applicability and imposing sanctions are not subject of implementation by member states adopting national by-laws. Regulations set out certain sanctions to subjects only but they do not provide states with the method of implementation. The differences among national legal systems and the practice of the EU member states stills exist, no common or “European” rules could be laid down, so an accurate mechanism for implementation shall be adopted on the national level17. Nevertheless, the EU Council has adopted the Guidelines on Imple- mentation and Evaluation of Restrictive Measures in the Framework of the EU Common Foreign and Security Policy and “Best Practices” for the Effective

16 “The Council shall adopt decisions which shall define the approach of the Union to a particular matter of a geographical or thematic nature. Member States shall ensure that their national policies conform to the Union positions.” 17 The implementation of international sanction in Lithuania is set out in two main legal acts: The Law of the Implementation of Economic and Other International Sanction of 22 April 2004 (IX-2160) and Resolu- tion of the Government No 1679 of 30 December 2004 “On the Approval of Order of Supervision on the Implementation of International Sanctions”. 88

Implementation of Restrictive Measures18 in order to unify various ways regarding the implementation of sanctions. These documents aim for the stan- dardization and development of implementation methods, as well as the main issues, standard definitions and common wordings used in the EU legislation are presented. These papers are to be supposed as a step forward in order to minimize institutional discussions that usually appear during the process of adopting EU legislation. The Working Party of Foreign Relation Counsellors (RELEX) is charged with preparing legislation when the EU implements international sanctions or autonomously imposes on its own. Depending on the case, a working party responsible for the relations with certain third countries can also be included in this process. The right to initiate appropriate sanctions belongs to the country holding the EU Presidency or to Commission acting upon Article 75 or 215 of the Treaty on European Union19 regarding restrictions on relations with third countries. The draft document is submitted for the debates at the Committee of Permanent Representatives (COREPER) and for the adoption at the Council. It is worth noting that the discussions at the EU institutions on sanctions usually require a longer time: firstly, the reports from the Heads of Missions of the EU embassies in the countries under sanctions take some time, secondly, the interests of the EU subjects in sanctioned countries should be accommodated, as well as the procedures of adoption and legal implications halt the whole process. All these aspects cause the reality to be that the duration of adopting sanctions stretches up to several months.

2.2. Issues of Implementation of the Sanctions Imposed by the UNSC

At the moment (Autumn 2009), the EU implements the sanctions adopted by the United Nations Security Council against the following states (ref. Table 1 Currently Applied International Sanctions): Republic of Côte d’Ivoire, Iraq, Iran, Democratic Republic of the Congo, Democratic People’s Republic

18 The main documents describing the EU practice of the implementation of international sanctions are the following: 1) Basic Principles on the Use of Restrictive Measures, 2) Guidelines on Implementation and Evaluation of Restrictive Measures in the Framework of the EU Common Foreign and Security Policy, 3) EU Best Practices for the Effective Implementation of Restrictive Measures (these document are available on the Website of the EU Commission http://ec.europa.eu/external_relations/cfsp/sanctions/index_en.htm, 15 12 2009). 19 “Where a decision, adopted in accordance with Chapter 2 of Title V of the Treaty on European Union, provides for the interruption or reduction, in part or completely, of economic and financial relations with one or more third countries, the Council, acting by a qualified majority on a joint proposal from the High Representative of the Union for Foreign Affairs and Security Policy and the Commission, shall adopt the necessary measures. It shall inform the European Parliament thereof” (Article 215). “Where necessary to achieve the objectives set out in Article 67, as regards preventing and combating terrorism and related activities, the European Parliament and the Council, acting by means of regulations in accordance with the ordinary legislative procedure, shall define a framework for administrative measures with regard to capital movements and payments, such as the freezing of funds, financial assets or economic gains belonging to, or owned or held by, natural or legal persons, groups or non-State entities” (Article 75). 89 of Korea (North Korea), Lebanon, Liberia, Sierra Leone, Somalia and Sudan, as well as against the individuals and terrorist groups in relations with Osa- ma bin Laden, Al Qaida and Taliban. The EU cannot restrict the scope of the sanctions imposed by the United Nations, so it acts as an implementing entity and the appropriate process can be described as a mechanical transposition of the UNSC resolutions into the legal system of the Union. The main issue concerning transposition of the UN sanctions is the rapi- dity of adopting relevant legislation, especially in cases of freezing the funds of individuals in question, as they can be transferred to anybody at any time. For the sake of efficiency, this legislation should be adopted not later than 30 days after the adoption of relevant UNSC resolution. If these sanctions are already in force and only the corrections in the lists are needed, the Commission is entitled to act automatically in three days and adopt its regulation. Difficulties arise when the EU member states must to implement binding UN documents but on the other hand they are in a position to wait for the adoption the EU legislation implementing those documents. It would be obviously inefficient to pass a piece of national legislation according to UNSC resolutions when in a month comes, for instance, a directly applicable EU Council regulation. This problem is known to Lithuania as well, as the Law on the Imple- mentation of Economic and Other International Sanctions of 2004 has an obligation that the sanctions adopted by the international organizations shall be implemented by resolutions of the Government in case of no EU regulations. In everyday life, to pass a resolution of the Government takes two months and this lead to a situation of no legislation in Lithuanian legal system until the adoption on EU sanctions. Article 60 of the Treaty on European Union after the amendments done in Amsterdam in 1997 foresaw possible provisional national measures, specifically in case of freezing of assets, but it was not put in practice20. Another issue is the duration of sanctions. The UNSC usually revises the sanctions in force before the date or their termination, or do not set out a certain period of validation at all and provides only with circumstances or desired changes in a sanctioned state that could lead to the revocation of sanctions. The EU documents usually contain the period of validation, so the difficulties arise in order to harmonize the validity of the sanctions in UN and EU systems. In such cases it is very important for the EU to immediately cancel the international sanctions revoked by the UN – for this reason some EU legislation could even have a retrospective application. In order to augment the cooperation of UN and EU institutions, and to solve the abovementioned issues, UN-EU joint seminars are organized every

20 “Without prejudice to Article 297 and as long as the Council has not taken measures pursuant to paragraph 1, a Member State may, for serious political reasons and on grounds of urgency, take unilateral measures against a third country with regard to capital movements and payments. The Commission and the other Member States shall be informed of such measures by the date of their entry into force at the latest.” 90

year in order to discuss technical question of implementation and coordination. The officials who are directly dealing with the implementation of sanctions and adoption of relevant legislation, for instance, representatives of the Working Party of Foreign Relation Counsellors (RELEX) are the most welcomed to these events. In conclusion on the EU practice to implement the sanctions imposed by the UN, this practice could be considered as an obvious relief for the EU member states which has no further obligation to adopt national legislation where EU regulations already exist. In Lithuanian practice, political sanctions usually imposed by other documents than regulations are directly transposed into the Lithuanian legal system as well because relevant resolution of the Government provides with common rules and obligations for the authorities in charge of their implementation21. In spite of this general simplification, member states have to adopt appropriate by-laws setting out a detailed order for the implementation of international sanctions.

2.3. EU Unilateral Sanctions as a Foreign Policy Instrument

Unilateral or autonomous sanctions are considered as an instrument of the EU Common Foreign and Security Policy, which is used in order to affect certain states’ foreign policy which in some cases violates human rights or to impose restrictions on individuals subject to war crimes. These sanctions cannot be regarded as technical implementation of international sanctions imposed by the United Nations. At this moment (Autumn 2009) the autonomous sanctions imposed by the European Union can be divided into the following groups: • Sanctions imposed for the infringements of human rights and internal repressions: against Belarus, Myanmar/Burma, China, Moldova (Transnistrian Region), Uzbekistan and Zimbabwe; • Additional restriction to the UN sanctions against Iran; • Sanctions against individuals indicated by International Criminal Tribunal for the former Yugoslavia: against certain citizens of Bosnia and Herzego- vina, Croatia, Former Yugoslav Republic of Macedonia22 and Serbia; • Sanctions against those who committed crimes: Syrian citizens suspected of involvement in the murder of former Prime Minister of the Lebanon, Rafiq Hariri; • Specific sanctions against Haiti, Iraq, Libya and Serbia prohibiting to satisfy certain claims of these country for former sanctions regimes towards them; • Sanctions against the USA prohibiting to apply certain US legislation having an exterritorial application (on the territory of third countries).

21 Resolution of the Government No 639 of 6 June 2007 “On the Implementation of Political Sanctions Prohibit the Entry and Transit of Individuals through the Territory of the Republic of Lithuania”. 22 In case of Former Yugoslav Republic of Macedonia, visa ban was applied to persons challenging the Ohrid Framework Agreement. 91

Autonomous sanctions are defined according the EU strategy and foreign policy towards certain countries and they are used to stimulate changes in them. It is extremely important to evaluate if the sanctions in force are proportional in order to achieve their goal, as well as to set out the indicators when they are to be lifted up. Upon imposition of sanctions, reasons of such decision and infringed international law norms are also written in a detailed manner. The EU stressing the importance of human rights and, in the same sway, protecting itself from possible lawsuit, for instance, for an illegal inclusion of persons into sanctions lists, is starting to frequently provide with the reasons of inclusion, even in cases of the UN sanctions already in force23.

2.3.1. When UN Sanctions Are Not Sufficient

One of the best examples of EU autonomous sanctions is the restrictions imposed against Iran and complementing sanctions imposed by the UN: i.e. additional political (movement) and financial sanctions against certain individuals; freezing of assets belonging to companies involved in nuclear and missile programs (among them there are a couple of bank having branches in foreign countries); prohibition to export related equipment and technologies, as well as vigilance towards certain companies and goods imported by them, which are not considered as of strategic importance but can be used in the abovementioned programs. The policy of autonomous sanctions towards Iran can be assessed as an instrument in a more global EU-Iran relationship seeking to prevent Iran from the acquisition of nuclear weapons. The EU has imposed a broader embargo than the UN on military equipment towards North Korea as well24. The researches of International Atomic Energy Agency (IAEA) started in 2002, demonstrated that Iran had maintained secret uranium enrichment programs which make the acquisition of radioactive materials and other equipment possible. Following these conclusions, the USA and Israel accused Iran of concealment of nuclear program but at the same time China and Russia having with Iran trade in technologies demanded more obvious proofs about development of inappropriate programs. In this context, the European Union saw an opportunity to contribute to the solution of the so-called “Iranian issue” – three EU member states (the United Kingdom, France and Germany – also referred as EU3) started negotiations with Iran in 2003. The talks ended in 2004 with the Paris Agreement where Iran promised to halt the uranium enrichment and reprocessing, as well as to start cooperation with the IAEA.

23 Abovementioned Council Common Position 2008/652/CFSP amending Common Position 2007/140/CFSP concerning restrictive measures against Iran appeals to the UN sanction as a basis for enlisting. 24 Council Common Position 2006/795/CFSP of 20 November 2006 concerning restrictive measures against the Democratic People’s Republic of Korea imposed arms embargo. However, relevant UNSC resolution 1718 (2006) limits only the export of lethal military equipment (such as tanks, fighters, vessels etc.). 92

Despite this agreement, in 2006, Iran stopped verifications carried out by the UN inspectors in its nuclear objects and declared about the renewal of uranium enrichment. Taking note to such actions, in 2006 and 2007, the United Nations Security Council adopted resolutions imposing sanctions against Iran. The EU immediately implemented these UN sanction, moreover, it adopted its own additional restrictions. The same year the EU3, as well as Secretary-General of the EU Council and High Representative for CFSP, Javier Solana, suggested Iran a negotiation package providing with an active support to build a light water reactor instead of termination of Iranian nuclear program but Iran rejected these suggestions. After refusal, the EU started the process of an imposition of broader autonomous sanctions. In the end of 2007 the EU3 and other negotiating countries, the USA, Russian Federation and China, agreed upon a “two-way approach” denoting the development of a dialogue with Iran but also not to renounce their pressure through the implementation of international sanctions. This example unveils the ways how the EU can use the imposition of sanctions for its foreign policy goals and strengthen its position among other actors of international politics. One question remains unanswered whether such sanctions policy is effective if Iran has not agreed to stop the development of its nuclear and missile programs. It is also useful to remark that only additional sanctions imposed towards Iran are often considered as autonomous in order to emphasize that the EU supplements UN restrictions. Other sanctions imposed by the EU are directed to the countries that are not subject of international sanctions applied by the UN or these are insignificant.

2.3.2. Additional Regards of the EU to the Defence of Human Rights

The sanctions against Belarus was adopted in 2006 and are applied to individuals responsible for violations of international electoral standard in the presidential elections in Belarus on 19 March 2006, and the crackdown of civil society and democratic opposition, as well as against natural and legal persons, other subjects and institutions related to these individuals25 – there is a visa or transit ban in the territory of the EU and their assets are frozen. Nevertheless, in the beginning of 2009 the EU Council, seeking to promote its Neighbourhood Policy and encourage the Government of Belarus for democratic changes and respect of human rights and fundamental freedoms, decided to temporary suspend the application of political (movement) sanctions but it has not repealed them. There is a period of nine months foreseen at which the Council should monitor developments in these areas and decide upon further application or revocations of sanctions. This example demonstrates that the

25 Common Position 2006/276/CFSP of 10 April 2006 concerning restrictive measures against certain officials of Belarus. 93

EU uses the instrument of sanctions in order to motivate third countries to respect human rights; there are also exceptions if the situation in the countries seems to improve. A similar policy is conducted in case of Uzbekistan. When Uzbek security forces used a disproportional force during events in Andijan in 2005 the EU imposed autonomous political, financial and some specific economic sanctions (not only arms embargo but restrictions to sell equipment intended for internal repressions al well). Uzbekistan was encouraged to completely meet its international obligations in the sphere of human rights and fundamental freedoms and allow a free monitoring on this process to be carried out by representatives of relevant international organizations. The Council in its conclusions in 2007 and 2008 emphasized a development in the area of human rights and temporary stopped the application of political sanctions but arms embargo remained in force. Every year the EU Council had to assess the situation in Uzbekistan and decide upon imposition or revocation of further restrictions – this was a reminder for the country that its internal situation is permanently observed. It is worth noticing that the EU could not allow itself to react so independently to situations in third countries if the UN sanctions could be in force. Moreover, the EU when imposing autonomous sanctions is able to anchor its role as a subject of international politics and within the Union to better coordinate certain foreign policy spheres of its member states. The restrictions against certain officials of the Transnistrian region can also be classified to the same domain. According to the EU position, Transnistria is an integral part of Moldova, so the sanctions are commonly referred as those against Moldova. Their object is persons responsible for the broad intimidation and closure campaign against teachers, parents and students of Latin-script Moldovan schools in the Transnistrian region. At the moment the situation is not improving, thus the EU retains its policy to apply political (movement) sanctions. In order to find persons subject to war crimes and officially indicated by the International Criminal Tribunal for the former Yugoslavia, the EU imposed political and financial (freezing of assets) sanctions against certain citizens of Bosnia and Herzegovina, Croatia and Serbia. The number of these persons is limited and they are increasingly arrested. Similar sanctions are applied to the Syrian citizens suspected of involvement in the murder of former Prime Mi- nister of the Lebanon, Rafiq Hariri, in 2005. However, no additional sanctions are imposed against Syria despite the recent accusations to acquire and re-sell equipment and technologies related to weapons of mass destructions. The significant violations of human rights and instable internal situation in Myanmar/Burma and Zimbabwe led to the EU sanctions being ones of the broadest restrictions regarding their scope and including prohibition to sell military equipment, freezing of assets belonging to governmental officials and their family members and prohibition to enter the territory of the Union. As the situation in these countries does not seem to improve, sanctions are increasingly enhanced – usually the control lists are revised and this job is usually done according to the reports of the EU embassies in these states. 94 2.3.3. EU Arms Embargo Imposed to China

Embargo on military equipment imposed by the EU to China can be considered as one of the eldest sanctions, which were adopted at the EU summit in Madrid just after the brutal repressions of Chinese military against a peaceful demonstration on the Tiananmen Square in 1989. This prohibitions still survives nowadays but it is criticized more frequently and even bypassed by some EU member states due to its uncertainty. In 1989 the Community did not have a common sanctions policy nor did the Common Foreign and Security Policy of the European Union exist26. A political obligation not to sell military equipment to China was set out in the political Madrid Declaration. This short document does not contain any scope of arms embargo nor did the EU have a common list of military equipment, which is the current reference point upon imposing arms embargoes nor there existed any mechanism on how to implement these sanctions and verify them (e.g. as of 1999 the EU member states have to submit annual reports on arms sales). In a later stage, the EU arms embargoes imposed to third countries and regarded as measures of the Common Foreign and Security Policy were better defined in details laying down concrete objects of restrictions, validity periods and procedures of their revision. This inaccurate situation about arms embargo on China caused a situation when some states circumvented it and sold different military equipment to China27; there was also a clear disagreement among the EU member states whether the embargo covers any type of military equipment or only, for instance, the so-called “lethal” one28. During the recent years, these considerations became more mainstream having watched the rising Chinese economy military reforms being carried out, especially rearming the Chinese (People’s Liberation) Army. Significant amounts of military equipment were sold by other Western states as Israel, the USA and Canada and this fact evoke a sound anxiety of China’s neighbours. Last decade noticing a rapid growth of the Chinese economy and an appearance of certain freedoms, the revocation of arms embargo became a topic again. It was considered as a signal bearing a positive assessment of improving situation in the country and encouraging further reforms especially in the area of human rights. These circumstances allowed the issue of revocation of arms embargo on China to become one of the EU foreign policy’s instruments giving a chance, as it was comprehended, for the EU to have an effective tool to push and encourage China to change its policy. This idea is set out in the

26 Common Foreign and Security Policy, as a second pillar of the EU, appeared only in the Maastricht Treaty in 1992 when the European Community became European Union. 27 According to the estimation of Stockholm International Peace Research Institute (SIPRI), China’s most significant arms import was carried out from the Russian Federation, France, Israel and the United Kingdom. According to Wezeman S.T., Bromley M., Wezeman P.D., International Arms Transfers, Sipri Yearbook 2009, http://www.sipri.org/yearbook/2009/07, 15 12 2009. 28 The term “lethal” is sometimes reworded as “dead weapons”. It encompasses armored vehicles, aircrafts, vessels, cannons. 95

Council’s Conclusions29 adopted during the Dutch presidency over the EU (on 16-17 December 2004) containing a political will to lift up the arms embargo. Member states predicated on the assumption that trade amounts with China were not to grow after the revocation of embargo neither in qualitative nor in quantitative way. This European position under formation invoked an extensive criticism for the US side and the countries situated close to China, Japan, South Korea and Australia. They asked to pay attention to the possibilities of regional tensions if China possessing new technologies, and if this would start any action against Taiwan. The EU promised its allies not to hurry in actions and carry out a thorough investigation of the regional situation, as well as one to adopt a new biding legislation within the Community on strengthening the control of arms exports. One of them was a common position, which had to replace the only politically binding ES Code of Conduct on Arms Trade. Another project was the adoption of post-embargo measures30 setting out a three-year stricter control for countries after the revocation of embargo upon them. Due to the lack of consensus within the EU, the aforementioned common position was adopted only in December 2008, moreover, the document providing with post-embargo measures were eventually forgotten, however, some EU states unofficially used it in cases of intended arms export because of its logical pre-emptive measures. It is however interesting that the adoption of this common position in 2008 was not based on a will to lift up arms embargo against China but absolutely different circumstances – after 2004, when the idea of revocation of arms embargo to China was spread out, the EU member states became one of the most active countries supporting the project of an Arms Trade Treaty31 to be a control instrument for global trade in military equipment. In discussions the EU cannot simply surrender the critics that, on one hand, it supports stricter arms control and disarmament but, on the other hand, it is not able to reach a consensus within itself on the rules suggested to others. The issues of lifting up arms embargo towards China is halted for some years and is raised only at the meetings with representatives for China’s neighbours. This example on EU’s attempts to manipulate the issue of sanctions towards China can clearly demonstrate the EU’s will to use an instrument of sanctions in order to achieve its political ends (the Madrid Declaration itself

29 Council Conclusions adopted on 16-17 December 2004 is available on the EU Council website http:// www.consilium.europa.eu/ueDocs/cms_Data/docs/pressData/en/ec/83201.pdf, 15 12 2009. 30 It is the so-called “Tool-box” setting out such measures as regular exchange of information about the country when the sanctions towards it were lifted up, detailed examination of licenses to export military equipment. 31 Arms Trade Treaty is a still an idea to adopt an international treaty binding all parties and setting out minimal standard for arms sales: for example, not to sell them to countries where human rights are violated or under military conflicts. More about EU activities in this area at http://www.consilium.europa.eu/showPage.aspx?id=1484&lang=en#exp7, 15 12 2009. 96

has defined the purely political nature of this issue). Nevertheless, the EU lacks the political will to finish with this question and reach some concrete results for the time being – firstly, there is no consensus among the member states, secondly, still a severe reaction from the partners exist. The EU linked this issue with the adoption of certain documents which seemed to be more useful for other purposes than elevating China’s question or just facilitating everyday activities of national institutions of the member states, so they were naturally used. One more important factor was an entirely technical comprehension that existing ES instruments are sufficient in order to limit export of arms and technologies to China but on the other hand it enable them to circumvent the embargo and sell desired equipment to China32. This situation was satisfying countries supporting both options – even bigger states developing trade with China, as well as such states as Scandinavian countries emphasizing the respect for human rights.

2.3.4. “Anti-sanctions”33

One of the strangest sanctions imposed by the EU is the prohibition to satisfy certain claims which can be submitted against the EU subjects by Haiti, Iraq, Libya and Serbia due to former restrictions when these countries were under sanctions regimes, i.e. arms embargo imposed by the UN, visa bans applied to their citizens and freezing of assets. If after the sanctions were revoked, there is an obligation in force for the EU member states to retain measures necessary to protect the interests of EU subjects from the claims stemming out from former arrangements and deals the, implementation of which was affected by the UNSC resolutions imposing those sanctions. The sanctions differ in their principle from common sanctions imposed by the UN or EU to the extent that they have no concrete restrictions towards the subjects of third countries but directly protect the interest of EU citizens. If in the latter case, the EU transposed the obligations of the UN sanctions, the EU sanctions against the USA could be described as absolutely autonomous. The USA is among a small group of states that the legislation of which could have an exterritorial application, i.e. this legislation could cause legal effects in a foreign country. However, this practice can be enforced if the competent authorities of that foreign country accommodate such a piece of legislation having an extraterritorial applicability in their further legislation. Having this motive in mind, the EU adopted a common position and relevant regulation not recognizing the principle of exterritorial effect included

�� For instance, it is possible to sell hardly defined or ultramodern technologies via third countries bearing in mind that those technologies are not listed in the yearly renewable EU Common Military List.. 33 In legal literature two terms are defined: “countermeasure” and “sanctions”. For the first case, the impact of other country is temporary limited, for the second case, “sanctions” are a means of punishment. According to Evans M., ed., International Law, 2nd Edition, Oxford University Press, 2006, p. 524. 97 in some EU legislation. The EU clearly emphasizes the application of national legislation to other countries constitutes a breach on international law, so it generates an obligation for the EU to protect its citizens and other entities according to its own law. These is a tangible purpose of this prohibition set out as well – the Union endeavours to achieve to the greatest extent possible the objective of free movement of capital between member states and third countries, including the removal of any restrictions on direct investment – including investment in real estate – establishment, the provision of financial services or the admission of securities to capital markets34. In addition there is an obligation for the EU subject to inform the Commission in case of such actions of third countries. The Council regulation35 setting out these positive sanctions even contains a list of certain EU legislation having an exterritorial application – i.e. sanctions against Cuba, Iran and Libya all of them imposed in 1996. These sanctions provides with obligations to maintain a global economic embargo and cancel all financial relations with Cuba as it is implemented in the USA, in case of Iran and Libya – to waive considerable investments to oil industries of these countries. The regulation also demonstrates possible damage for EU interests, namely, legal proceedings in the USA, forfeiture, fines, and impri- sonment in cases of violation. Apparently such EU “anti-sanctions” expose two-fold purposes of the EU – to protect the interests of its citizens and other entities and implement the international sanction imposed only by international organizations but no restrictions of separate states. In most of the EU member states a similar principal is under respect – the sanctions imposed by third countries are not biding and can only be regarded as for recommendation. For the conclusion, one must remember that in Lithuania there are only rules for implementation of international sanctions adopted (according to the aforementioned Law on the Implementation of Economic and Other International Sanctions of 2004) but there no provisions for cases of unilateral sanctions imposed by other countries or on the impositions of purely national ones.

2.3.5. EU Sanctions against Its Internal Subjects

After the terrorist attacks on 11 September 2001 in the USA, new action has been taken in order to halt the activities of terrorist groups and curb the provision of assistance to them. On 28 September 2001 the UNSC adopted resolution 1373 (2001) aiming the prohibition of terrorism financing. Even though the funds belonging to Osama bin Laden and his allies were frozen afterwards, the common lists of sanctioned terrorists were substantially enhanced.

34 Council Regulation (EC) No 2271/96 of 22 November 1996 protecting against the effects of the extraterritorial application of legislation adopted by a third country, and actions based thereon or resulting therefrom. 35 Ibidem. 98

In this context the EU Council adopted Common Position 2001/931/ CFSP of 27 December 2001 on the application of specific measures to combat terrorism. It provides with a list including not only persons and entities linked to Osama bin Laden or other so-called “traditional” terrorist organizations, for instance, related to Hizballah or Hamas networks, but also organizations and individuals active within the EU and having its citizenship. The most of them are Basques of the ETA organization, among others the Irish Republic Army, Ulster Defence Association and the similar could be found as well36. It means that the EU has adopted financial sanctions directed to its own citizens and such restrictions form their nature could not be considered as international. Otherwise, the activities of these entities, despite their local scope, do not differ from practice of international terrorist organizations. It is worth noting that the abovementioned common position defines which actions could be treated as terrorist ones; however, the EU member states are entitled to finally define the concept of “terrorist act” according to their national law and to the definition of “an offence” therein37. It clearly shows that the sole and internationally accepted definition of “terrorism” does not exist. Upon adoption of financial sanctions against its own citizen, the EU Council could only adopt a common position but no regulation – it means that the political will to restrict the entities in question was conveyed but the EU member states had an obligation to pass national legislation implementing sanctions with concrete measures.

* * * The examples provided demonstrate that the EU adopts sanctions complementing the ones adopted by the UNSC, as well as it imposes unilateral restrictions to third countries, defends its citizens from the sanctions having exterritorial application and even restrains some rights of its citizens – i.e. the EU actively uses international sanctions as an instrument in international politics. The procedures of imposition and application of sanctions are sufficiently explicated, moreover, every member states having an obligation to put into practice the legislation adopted by the Council and Commission shall also set up concrete measures in order to implement international sanctions on national level. Nevertheless, plenty of questions remain on how this instrument of impacting third countries can be effective more than that of a political will or political manifestation. One could ask if the policy of sanctioned countries becomes different after the imposition of sanctions – the last chapter of the article goes on that.

36 Some terrorist organizations have very funny names, for instance, Cooperativa Artigiana Fuoco ed Affini – Occasionalmente Spettacolare (Eng. Artisans’ Cooperative Fire and Similar – Occasionally Spectacular). 37 Point 3 of Article 1 of Council Common Position 2001/931/CFSP of 27 December 2001 on the application of specific measures to combat terrorism. 99 3. Other Measures Equating Sanctions

When writing on arms embargo it is necessary to mention an export control system of military equipment and dual-use goods and technologies effectively operating in every EU member state. In order to export such goods to another state, especially in cases where such states are not EU member states, an export license is to be acquired. The same procedures are applied for cases of brokering, transit and trans-shipment38. Export control of military equipment comes under the framework of the Common Foreign and Security Policy and the principles of control are defined in Council Common Position 2008/944/CFSP of 8 December 2008 defining common rules governing the control of exports of military technology and equipment. This common position has eventually implemented the EU Code of Conduct on Arms Export adopted by the Council in 1998 which was in force until the adoption of the common position. The common position is regarded as a legally binding document setting out eight criteria regarding that which the EU member states decide upon the granting of export licenses for military equipment, mechanism of exchange of information among the states and transparency related measures. The control of dual-use goods, on the other, comes under competence of the Union and is defined in Council Regulation No (EC) Nr. 428/2009 of 5 May 2009 setting up a Community regime for the control of exports, transfer, brokering and transit of dual-use items. According to these documents, the control lists of military equipment and dual-use goods subject to be licensed by the competent state authorities were approved. Licenses are granted if the importing countries are in line with the abovementioned eight criteria39, including, inter alia, the respect for human rights, absence of internal and regional conflicts, fight against terrorism and economic capacity to buy military equipment. The EU member states are also entitled to license the export of goods that are included to the control lists40 but could be used for the development of weapons of mass destruction or shipped to sensitive countries. In reality these requirements often mean that a relative arms embargo could be imposed on certain countries which do not fall under international sanctions. Despite the fact that every case of export is assessed separately on

38 Brokering denotes an activity when sold goods physically do not enter the country where a person organizing such a transaction resides. Transit denotes an activity when goods are carried though the territory of a country and the carrier is neither consignor nor consignee. Trans-shipment denotes an activity when goods during transiting a country are loaded of one means of transport into another one. 39 Eight criteria: 1) absence of international sanctions against the state, 2) respect for human rights, 3) absence of armed conflicts within the country, 4) regional stability, 5) the countries does not put a risk on national security of allies of exporting country, 6) fight against terrorism, 7) commitments not to re-export the equipment, 8) economic capacity to acquire military equipment. 40 The so-called “catch-all” procedure set out in Article 4 of Council Regulation No (EC) Nr. 428/2009 of 5 May 2009 setting up a Community regime for the control of exports, transfer, brokering and transit of dual-use items. 100

national level, the EU member states frequently regard their common policy and do not sell arms if, for instance, human rights are violated in a certain country. It is untrue that if there are no official sanctions imposed to a country arms export could be freely conducted (ref. Table 2 Denied Licenses by the EU Member States to Third Countries in 2007 and 2008). In conclusion, it is obvious that the EU countries actively pursue this instrument in the context of high level political background as an incapability to reach a decision, for instance, in UN Security Council where the positions of such countries as Russia and China often are different for the positions of the Western states. Exports control is also effective in coercing the countries to change their actual policy, e.g. it is a consensus decision not to sell guns to African countries due to unsatisfying situation of human rights. In these cases it is important to reach a harmonious decision among the EU member states and it gave reason for their representatives to gather themselves on a regular basis to the meeting of the EU Council Working Party on Conventional Arms Exports (COARM) and to change information on sensitive countries and make decision on the harmonization of national export control systems. In comparison to other countries, the EU has one of the highest export control standards and they allow the EU to possess additional measures to implements its foreign policy beside international sanctions.

4. The Question of Efficiency of International Sanctions

The imposition of international sanctions is not a spontaneous objective of an international organization – the sanctions are targeted to change internal or foreign policy of the countries or other subjects in question. Frequently attention is given to the analysis of the process of adopting international sanctions but a more important question remains on their efficiency and the level of it. To assess an impact of sanctions is a hard task; moreover, the assessment should be different according to object subject to sanctions as sanctions can limit the needs of the elite in power in order to restrain them from the resources or put restriction on the whole society to augment dissatisfaction against the government. Often both cases are to be combined but refraining to wrong unrelated persons and limit basic needs for living. One of the methods to evaluate the efficiency of sanctions is to look at the fact regarding how many or what sanctions have been lately lifted up. They could partially demonstrate their impact of targeted subjects that caused their needlessness as an instrument for foreign policy. One could assess the duration of their application as well as it gives information on the expediency of sanctions. Currently the EU applies sanctions to 20 countries excluding persons prosecuted for terrorism and war crimes in former Yugoslavia. A part of these 101 sanctions has been imposed more that 10 years ago, for instance, against Sier- ra Leone and China (even 20 years ago). As of 2006 sanctions were imposed, revised in cases of already being in force or reinforced for the most of the sanctioned countries including Myanmar/Burma, Democratic Republic of the Congo, Republic of Côte d’Ivoire, Iran, North Korea and Zimbabwe. The list of individuals related to terrorist organizations swells as well – from 2002 to the end of 2009 this list was amended for 118 times. Unfortunately, there are only several states the sanctions to which were lately repealed or softened: arms embargo and other economic sanctions were lifted up for Angola, Haiti, Libya, Rwanda and states from former Yugoslavia; political (movement) sanctions were temporary suspended for Belarusian officials and repealed for Uzbekistan. There is also some negligible alleviation to sanctioned countries in Africa, Afghanistan and Iraq where the UN or EU missions are deployed and relevant national security forces being rebuilt. It naturally dimi- nishes the scope of sanction applied. It is likely that the last persons indicated by International Criminal Tribunal for the former Yugoslavia would be arrested. These statistics demonstrate a trend of imposing new sanctions, leaving aside the European will to use them as an instrument for foreign policy. It suggests that sanctions are not ever so effective and giving desired objectives at once. Moreover, they cannot be considered as a primary reaction of the EU to policies of a certain state as well but, for instance, a measure supplementing military missions. That is why in many cases sanctions can be defined only as a minimal reaction of international community directed to unacceptable behaviour of certain countries but not concrete measures to coerce them. The scope of further enhancement of sanctions and their limits could be apprehended through the case of Iran subject to the EU sanction as of 2007. Despite the fact that the EU member states were expressing certain vigilance when assessing export opportunities towards Iran and had in mind the US restrictions already in force, the official sanctions were imposed only when Iran did not obey the requirements to halt the development of nuclear and missile programs. The embargo encompassed restrictions on trade in arms and dual-use goods, the assets of certain companies and persons were frozen and visa ban was imposed upon them. On a later stage, the EU broadened the UN sanctions in imposing new additions to almost every area of restrictions – it allows us to emphasize that at the moment the sanctions against Iran are the most extensive EU sanctions ever (certainly, they cannot be compared to the entire blockade of Cuba implemented by the USA)41. Despite these European measures, the policy of Iran does not change42. The society suffers (for instance, there is a lack of new technologies and aircrafts get old) but the government do not give up on further plans to develop nuclear program not accessible for international community to monitor it. This

41 In Iranian case, the sanctions against it come even closer to an entire trade embargo describe in theory about international sanctions. Other states portrayed in this article are only subject to partly trade restrictions, for instance, arms embargo. The differences between the entire and partly embargos are laid down in Aust, A., Handbook of International Law, Cambridge University Press, 2005, p. 218. 42 In December 2009 Iran declined the proposal made by the USA, Russia, France and the International Atomic Energy Agency (IAEA) to continue the enrichment of uranium in Russia and France, so ensuring the right of Iran to pursue a peaceful use of nuclear technologies and uranium afterwards would be appropriate for medical use. 102

situation keeps on evident doubts for the efficiency of international sanctions and the status is getting even worse as the EU with its allies do not know how to enhance these sanctions as all traditional measures are already used. A strict European foreign policy did not give good results and did not work as leverage in order to attract the Iranian government into negotiations. Another example of inefficiency of sanctions as an official instrument of international politics arises from the policy of the EU member states in reacting to the Russian military action in Georgia in August 2008. The EU member states, some of which were accused of supplying Georgia with arms and which denied it later on, immediately suspended such exports as it was required in accordance to the criteria of the EU Code of Conduct on Arms Trade (later changed to EU Council Common Position 2008/944/CFSP) when assessing export of military equipment. There was no official arms embargo imposed towards Georgia but the EU member states followed a common policy. It means that there are different measures to limit arms sales and other than legally set out and binding sanctions, as well as this instrument is much time-consuming for its adoption, so not that flexible. On the other hand, almost nobody spoke on possibilities to impose arms embargo on Russia because it is a senseless thing. Russia is a country being able to produce itself enough of military equipment and much more for the export. Moreover, it is an influential country as well and imposition of arms embargo does not pay off politically (the level of Russian armament does not rely on imports too). The EU is not in a position to repeat the Chinese case with an undefined arms embargo which interrupts ever closer cooperation between the EU and China. Consequently, the EU reacting to the Russian-Georgian conflict can easier and swifter limit the smaller side, i.e. Georgia. The efficiency of sanction could be also analyzed taking into account the country, the sanctions to which are already repealed – to Angola, Haiti, Libya, Rwanda, Belarus, Uzbekistan and states of former Yugoslavia. They can be distinguished either by their economic underdevelopment or strategic position, the latter being quickly comprehended by their governments. To impose sanctions against relatively poverty-stricken Angola, Haiti and Rwanda and by such means seek to influence their governments is not complicated. Some other actions are required in case of significantly wealthy and larger Iran having internal resources for survival. For this reason the efficiency of sanctions depends on the capabilities of a country to withstand them and it suggests that the instrument of sanctions is not universal. The group of countries as Belarus, Uzbekistan and, for instance, Bosnia and Herzegovina understand the use of resuming relation with other states especially the neighbouring ones. Closer economic ties and growing economics with well-developed European countries of richer neighbours are a sufficient stimulus to reject their former policy and earn additional and tangible benefit of it. This process could be evaluated twofold: the change in state’s policy could be impacted of its lucrative calculation, as well as the subject which has imposed sanctions could choose not to use restrictions but rather to offer a reward. 103

Thus, international sanctions might not be the only possible explanation why the policy of sanctioned country has changed. This idea could also refer to selfish striving of international organization or states being able to impose sanctions to make use of resources owned by a sanctioned country. Libya known as rich in oil and China entitled as a country of tremendous trade opportunities could well be examples. The interests of some states to seize possibilities and seek for economic benefit in many cases compete with principles of expanding the area of democracy and encouraging the respect for human rights. On principle such situation rather weakens the efficiency of international sanctions and the will to use them. This issue might be very salient for the European Union upon imposition of autonomous sanctions – that means that third countries in the absence of universally binding UNSC sanctions could profit by this situation. Moreover, in such a case the EU creates unfavourable conditions for its own citizens and it could be one of even stronger reasons why the governments search for other ways to eventually impose for themselves less “harmful” sanctions formally applied to other countries. The Chinese case of ambiguous arms embargo is good to promote this version. In conclusion, one could estimate that there are significant difficulties using the instrument of sanctions to seek considerable political objectives in international politics and EU activities. This is the reason why sanctions remain as a signal firstly when the situation in country is negatively evaluated. They are also an indication for the internal and external audience of the EU that the EU is reacting to internal of foreign policies of other states. However, further implementation meets difficulties because of resistance of the states in question against the sanctions in force (it means these sanctions are not well-developed and therefore ineffective) and internal interests of sanctioning subjects. Despite the fact that international sanctions are the most legal instrument of international law in order to change the policy of other state43, the still surviving long list of the states sanctioned by the EU demonstrates that sanctions are not a highly effective instrument of foreign policy.

Conclusions

The EU policy to impose sanctions, which can be treated as certain non- military coercive measures, is one of the instruments of Common Foreign and Security Policy. The EU completely implements the sanctions imposed by the UN and has imposed a number of additional or autonomous sanctions. The implementation of the sanctions adopted by the United Nations Security Council is an evident alleviation for the EU member states which have

43 Simmons B. A., Steinberg R. H., eds., International Law and International Relations, Cambridge Uni- versity Press, 2006, p. 335. 104

not to pass additional national legislation in this area. Unilateral (autonomous) sanctions are also among the instruments of the Common Foreign and Security Policy which can be used in order to impact foreign policy of certain states. They usually enhance the UN sanctions as a consensus within the Union is naturally more feasible than in the Security Council or the entire UN uniting a number of countries. There is a conclusion that the EU often uses international sanctions as an instrument of its foreign policy. It demonstrates the will to actively act on the international arena and the appropriate comprehension of the instrument itself as well. At this moment, the EU has imposed sanctions towards 20 states, individuals accused of terrorism and war crimes. The sanctions are followed by the measures of export control of military equipment and dual-use goods, so sanctions could be considered as one of the most institutionalized instruments of EU foreign policy. Despite its broad application, it is evident that sanctions often meet difficulties in leading to desired political goals – this could be seen in the list of sanctioned states never being shorter. On the other hand, their contents and scope could not match the reality and the principle of expediency is infringed. This reason suggests that sanctions are primarily a political signal to warn a third country that its internal or foreign policy is negatively assessed. The inefficiency of international sanctions is also caused by the reluctance of international organizations and separate states imposing them to “punish” countries for the breach of principles imbedded in the Charter of the United Nations, for instance, for violation for human rights. This policy inconsistent to unquestioned values is mostly based on economic interests which has a tendency to augment due to globalization, current economic and financial crisis and decline in energy resources. International sanctions in Lithuania are implemented adopting resolutions of the Government in absence of directly applicable EU regulations – it can be described as a technical job for competent institutions. It is important to emphasize that Lithuania has no legal basis to impose unilateral restrictions that could be considered as sanctions. Lithuania being a member of the United Nations, European Union or OSCE, which are entitled to impose international sanctions will not be able to avoid discussions on the efficiency of these sanctions and a decision whether it is worth to adopt them having in mind economic interests as well.

Vilnius, July-August and appended in December 2009 105

Appendixes

Table 1. International Sanctions Applied Currently Organization Country Imposing Sanctions Remarks Sanctions Applied only to subjects involved Armenia OSCE44 • Arms embargo in Nagorno- Karabakh conflict

Applied only to subjects involved Azerbaijan OSCE • Arms embargo in Nagorno- Karabakh conflict Applied to certain government • Political sanctions Belarus EU officials, political • Freezing of funds sanctions suspended until 31 October 2010 Applied to individuals indicated by Bosnia and International UN and EU • Freezing of funds Herzegovina Criminal Tribunal for the former Yugoslavia

Adopted in 1989 by the political Madrid China EU • Arms embargo Declaration after the events on the Tiananmen Square

• Arms embargo • Political sanctions Republic of UN and EU • Freezing of funds Côte d’Ivoire • Prohibition to import diamond into the EU

1 Statement by Committee of Senior Officials of the Conference on Security and Co-operation in Europe, Annex 2 to Journal of the Eighth Meeting of the Committee, 13 March 1992. 106

Applied to individuals indicated by • Freezing of funds International Croatia UN and EU • Visa ban Criminal Tribunal for the former Yugoslavia

• Arms embargo • Embargo on dual-use goods Democratic • Prohibition to buy People’s certain technologies Republic of UN and EU • Political sanctions Korea • Freezing of funds (North • Inspection of cargoes Korea) from North Korea • Prohibition to sell luxury goods

Democratic • Arms embargo Republic UN and EU • Political sanctions of the Congo • Freezing of funds

• Prohibition to satisfy Haiti EU claims against EU subjects

• Arms embargo • Embargo on dual-use goods • Prohibition to buy certain technologies • Political sanctions • Freezing of funds Iran UN and EU • Prohibition on certain investments and financial relations • Prohibition to instruct specialists • Inspection of cargoes from Iran 107

• Arms embargo • Freezing of funds • Restrictions to trade in cultural goods • Duty to transfer benefits Iraq UN and EU acquired by selling oil to Development Fund for Iraq • Prohibition to satisfy claims against EU subjects

Applied to individuals suspected of • Arms embargo involvement in Lebanon UN and EU • Political sanctions the murder of • Freezing of funds former Prime Minister of the Lebanon, Rafiq Hariri

The prohibition • Arms embargo to import timber Liberia UN and EU • Political sanctions and diamonds • Freezing of funds was in force until 2007

• Prohibition to satisfy Libya EU claims against EU subjects

Applied Macedonia to persons (Former challenging EU • Political sanctions Yugoslav the Ohrid Republic) Framework Agreement 108

Applied to individuals responsible for the broad intimidation and closure campaign Moldova EU • Political sanctions against teachers, parents and students of Latin-script Moldovan schools in the Transnistrian region

• Arms embargo • Prohibition to buy certain • Political sanctions • Freezing of funds • Suspension of aid Myanmar and development UN and EU (Burma) programmes • Suspension of high level bilateral governmental visits • Reduction of diplomatic relations

Applied to individuals • Political sanctions indicated by • Freezing of funds International Serbia UN and EU • Prohibition to satisfy Criminal claims against EU Tribunal for subjects the former Yugoslavia

• Arms embargo Sierra Leone UN and EU • Political sanctions

• Arms embargo Somalia UN and EU • Political sanctions • Freezing of funds

• Arms embargo Sudan UN and EU • Political sanctions • Freezing of funds 109

Applied to individuals suspected of involvement in • Political sanctions Syria UN and EU the murder of • Freezing of funds former Prime Minister of the Lebanon, Rafiq Hariri • Prohibition to satisfy United States EU claims against EU of America subjects Repealed • Political sanctions Uzbekistan EU respectively in • Arms embargo 2008 and 2009 • Arms embargo Zimbabwe EU • Political sanctions • Freezing of funds

Sometimes it is indicated that, Members for instance, of Al arms embargo Qaeda and is applied to Taliban and Afghanistan45. individuals • Arms embargo The so-called relating to UN and EU • Political sanctions EU “internal Usama bin • Freezing of funds terrorists”, i.e. Laden, other citizens of the terrorist EU, are included organi- under the zations other terrorist organizations.

45 Resolution of the Government of 1 March 2005 No 237 “On the Approval of the List of the States to Which the Export or Transit of the Goods Listed in the Common Military List is Prohibited and for which Brokering in Negotiations and Transactions in the Goods Listed in the Common Military List is Prohibited”. 110 Table 2. Denied Licenses by the EU Member States to Third Countries in 2007 and 20084644 Denied Licences Country 2007 2008 Afghanistan 2 0 Albania 0 1 Algeria 8 2 Andorra 4 2 Angola 3 1 Argentina 0 2 Armenia 3 6 Azerbaijan 10 4 Bangladesh 14 8 Belarus 3 2 Belize 1 0 Bosnia and Herzegovina 1 4 Botswana 1 1 Brazil 2 1 Bulgaria 0 1 Burkina Faso 0 1 Cambodia 0 1 Cameroon 0 1 Canada 1 0 Central African Republic 11 1 Chad 7 4 Chile 1 0 China 47 30 Columbia 2 0 Croatia 1 0 Cuba 1 0 Cyprus (Northern) 0 2 Czech Republic 1 0 Democratic Republic of the Congo 0 2 Ecuador 1 2 Egypt 10 13 Ethiopia 4 0 Georgia 16 11 Ghana 0 1 Guatemala 3 0

46Compiled according to the Tenth and Eleventh EU Reports on exports of military equipement: http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:C:2008:300:0001:0374:EN:PDF and http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:C:2009:265:FULL:EN:PDF 111

Guinea 0 3 Hong Kong473 2 0 India 11 10 Indonesia 6 1 Iran 23 3 Iraq 0 6 Israel 28 22 Jamaica 3 0 Jordan 7 1 Kazakhstan 1 3 Kenya 1 1 Lebanon 5 3 Liberia 1 1 Libya 6 7 Macao484 1 3 Macedonia (F.Y.R.) 5 1 Malaysia 1 1 Maldives 1 0 Mauritius 0 1 Moldova 1 1 Myanmar (Burma) 0 1 Namibia 1 2 Nepal 4 2 New Zealand 1 0 Nicaragua 1 1 Nigeria 3 4 North Korea 0 1 Oman 1 0 Pakistan 19 23 Panama 2 0 Paraguay 2 1 Peru 1 0 Philippines 6 2 Republic of Côte d’Ivoire 1 3 Republic of the Congo 1 0 Russian Federation 7 8 Rwanda 1 1 Senegal 0 1 Serbia 1 5 Sierra Leone 0 4 Singapore 0 1 South Africa (Republic of ) 2 4 South Korea 2 1 Sri Lanka 23 33

47 Officially EU regards Hong Kong as a part of China. 48 Officially EU regards Macao as a part of China. 112

Sudan 3 2 Suriname 5 0 Switzerland 1 0 Syria 5 0 Taiwan495 17 9 Tanzania 2 0 Thailand 3 2 Timor-Leste 1 4 Trinidad and Tobago 0 2 Tunisia 3 3 Turkey 0 1 Uganda 5 2 Ukraine 11 7 United Arab Emirates 1 0 Uzbekistan 2 1 Venezuela 12 10 Vietnam 6 2 Yemen 4 5 Zambia 1 0 Zimbabwe 3 0

49 Officially EU regards Taiwan as a part of China. 113

Mindaugas Jurkynas* Institute of International Relations and Political Science, University of Vilnius

Regional Cooperation within the European Economic Area**

A theory-ridden case study analysis and institutionalisation of regional cooperation, empirically evaluates the existing mechanisms for regional cooperation by specifying functions and limits of the action of the European Commission’s Directorate General for Regional Policy, the Committee of Regions the European Free Trade Association, and the European Economic Area. Later on, the investigation looks for opportunities for the development of regional cooperation between the EU and EFTA Member States. In essence, modus operandi of the Directorate General for Regional Policy, the Committee of Regions, on the one hand, and the European Free Trade Association and the European Economic Area, on the other, are quite incompatible. The former entities are preoccupied with cohesion and regional cooperation mostly among the countries and sub-national units of the European Union, whereas the latter two are primarily driven by the participation in the common internal market. Nevertheless, these crossing each other functional trajectories can make their ends meet only given the existent political willpower to develop cooperation since the existing institutional frameworks provide certain tangents for enhanced cooperation.

Introduction

The year 2009 renders an opportunity for increased discourse about the European Union. The elections to the European Parliament in June 2009 and the process of the ratification of the Lisbon Treaty reinvigorated the debate about the role of the EU in the everyday lives of its citizens and the place of a politically unified Europe in global affairs. The European Union, as one of the most important players in world politics, does face a number of internal and external challenges: financial and economic crisis including its management; institutional reform; immigration; aging populations; climate change; energy security; international terrorism and organised crime; the EU enlargement; the EU neighbourhood policy; and EU-Russia relations are just a handful. During the last five years, the European Union expanded from 15 to 27 member states, increasing political, social, and cultural diversity, which requires

* Dr. Mindaugas Jurkynas is an associate professor at the Institute of International Relations and Politi- cal Science of the University of Vilnius, Vokiečių 10, LT-01130 Vilnius, Lithuania, tel. +370 52514139, [email protected] ** The article is a revised version of a study “Regional Cooperation and EEA (structures – DG REGIO, Committee of Regions); opportunities and challenges to develop regional cooperation between the EU and the EFTA”, presented to the Committee of Foreign Relations of the European Parliament in March 2009 (2006/S 154-165848). 114

efficient and attentive institutions to satisfy the needs of welfare, security, and legitimisation among the EU citizens. A sharp-sighted observer would also add an EU-related issue of ‘democratic deficit’, which implies a wide distance between the ‘eurocratic’ EU decision-making institutions and citizens. However, one may notice a “decreasing trend in civic activities offered by democratic systems, linked to the erosion of sense of belonging to community, local, regional, national or European”.1 The EU offers a legion of institutions that represent or at least take into consideration national, regional, and local interests. Some of them participate in the decision-making process and others contribute to the decision-shaping procedures. Still, a plethora of institutional opportunities help to search for value-added within the EU-related bodies aiming at the reduction of democracy deficit and enhancing the profile of the EU abroad, e.g. among ‘reluctant Eu- ropeans’, that is, the European Free Trade Association (EFTA) member states. Some of them can deliver and some need synergies with other organisational enterprises within the EU. The key objective of this article is to evaluate the relationship between the Directorate General for Regional Policy and the Com- mittee of Regions on the one hand, and the EFTA and the European Economic Area (EEA) on the other, and to discuss the possibilities for their collaboration. Some EU institutions are important for politics and democracy, whereas the others still have to find their synergies.2 Therefore, the paper will empirically evaluate the existing mechanisms for regional cooperation by specifying responsibilities and limits of the Europe- an Commission’s the Directorate General for Regional Policy (DG REGIO), the Committee of Regions the EFTA and the EEA, and investigate opportunities for the development of regional cooperation between the EU and EFTA Member States through analysed mechanisms. These institutions have been extensively researched, yet their cooperation is under-investigated. Therefore, a theory- ridden case study that analyses the institutionalisation of regional cooperation knowledge, about which might have practical relevance for Lithuania to be presiding in the EU Council in 2013 and fill in the gaps of information about the interrelation between the EU and EFTA. Moreover, strengthening external vectors of the EU in 2008-2009, as Eastern partnership, Mediterranean union, and EU Baltic sea strategy, Icelandic attempts to approach the EU politically gives us an opportunity to reconsider EU’s relations and collaboration potential with ‘wealthy’ neighbours in the continent. The initial parts of the analysis discuss the structural framework for regional collaboration, outline functions of the Directorate General for Regio- nal Policy, and establishes the role of Committee of Regions and the relation

1 Bekemans L., Intercultural Dialogue, Democracy & Active Citizenship in Europe, 2008, http://www. cor.europa.eu/COR_cms/ui/ViewDocument.aspx?siteid=default&contentID=746137e4-4ffb-43b0-b18a- 13f698bc25e9, 14 01 2009. 2 Hix, S., What’s wrong with the European Union and how to fix it, Cambridge Malden, Polity Press, 2008. 115 of the EFTA and to the EU. Finally, activities of the EEA and perspectives of developing regional cooperation between the EU and EFTA Member States are presented in the last chapters of the article.

1. Directorate General for Regional Policy and its External Vectors?

Theoretical insights suggest us that the European Union as a ‘mega-region’ possesses opportunities to expand cooperation with bordering regions and regional organizations via institutional collaboration, and also by involving different levels of political representation. Thereof, the outcomes of newly institutionalised cooperation among regional actors such as the European Free Trade Association, the DG REGIO, and the Committee of Regions can be designed to meet the economic, political and social challenges/needs and could signify a ‘new deal’.3 Expanded regional cooperation can influence the behaviour of parties involved and create new norms. Perhaps they can pave the way for furnishing European identity with good practices and synergies. Regular collaboration can change the perceptions of actors about themselves and partners. ‘Soft’ European integration without full membership could proceed with the assistance of analytically targeted institutions in case they can be pilot projects for policies of a ‘new neighbourhood’, which embraces less politically accentuated EFTA countries. A dominant party such as the EU, is in a favourable position to provide required conditions for revised cooperation and employ its interstate institutions and their modes of operation. These sustain a regular exchange of information, link mutually relevant issues and encourage parties involved to think of actions for common aims. Therefore, there is a need to clarify roles and the potential of the DG REGIO, the Com- mittee of Regions, the European Free Trade Association and the EEA for the development of more dense patterns of mutual cooperation with value added. The next chapter of the briefing will pay attention to functions of the DG REGIO and the Committee of Regions their interrelation and their links to the EFTA and EEA responsibilities. The chief objective of the Directorate General for Regional Policy is to reduce differences between the levels of development of regions and countries in the European Union and to strengthen economic, social, and territorial cohesion. The cohesion policy promotes improvements in competitiveness and employment and generally aims at the Commissions strategic objectives of prosperity and solidarity.4 According to the Annual Management Plan of the

3 Haas, E. B., The Study of Regional Integration, in Lindberg, L. N. and Scheingold, S. A. eds, Regional Integration, Cambridge, Prentice-Hall, 1971. 4 Regional policy is the main partner policy for the delivery of the Growth and Jobs strategy of the Lisbon Agenda. 116

DG REGIO for the 2008 European Cohesion policy, it pursued the stimulation of the growth potential of the least-developed Member States and regions, strengthening of regions’ competitiveness and attractiveness as well as their employment capacity and promotion of stronger integration of the territory of the EU, to support balanced and sustainable development5 and assistance to the candidate countries and potential candidate countries in their alignment with the standards and policies of the EU including cross-border cooperation.6 The Directorate General is responsible for three funds: the European Regional Development Fund, the Cohesion Fund, and the Instrument for Structural Policies for Pre-Accession. The European Regional Development Fund co-finances investments, the Cohesion Fund co-finances transport and environment projects and the Instrument for Structural Policies for Pre-Acces- sion helps candidate countries to develop transportation networks and improve environmental infrastructure.7 The Directorate General also conducts policy issues concerning the structural funds and thereof coordination with other Directorates General involved (Employment and Social Affairs; and partly Agriculture and Fisheries). The European Cohesion policy in 2007-2013 has undergone a significant reform and now seeks to contribute to a greater decentralisation. The implementation of the policy has been simplified, while maintaining emphasis in the partnership between the Commission and national and regional levels. The DG REGIO plans to launch and effective implementation of 335 programmes 2007-2013 and around 900 major projects (including 7 national programmes and around 45 major projects in candidate countries and 12 programmes for cross-border cooperation between member states and candidate and potential candidate countries).8 However, the DG REGIO structure and its functions are EU inward oriented and do not offer direct linkages with the EFTA organisation or its countries.

5 This will be achieved through joint cross-border projects for local development aiming at reducing effects of borders; transnational actions conducive to integrated territorial development linked to Community priorities; and identification and more efficient exchange of experience and good practice at the appropriate territorial level under the initiative ‘Regions For Economic Change’ 6 Annual Management Plan 2008 http://ec.europa.eu/dgs/regional_policy/document/amp2008_en.pdf, 15 01 2009. 7 The DGRP bears responsibility for additional three areas: the implementation of the European Union Solidarity Fund, which aims at rapid intervention in the case of major disasters; the co-ordination group on ultra-peripheral regions, which focuses upon the encouraging EU actions to implement measures compensat- ing for the disadvantaged situation of the outermost regions; and the management of the EU contributions to the International Fund for Ireland which aims at peace and reconciliation in Northern Ireland. 8 Moreover, for the next period of cohesion policy programmes for 2007-2013, four initiatives are prepared: 1. JASPERS: Joint Assistance in Supporting Projects in European Regions; 2. JEREMIE: Joint European Resources for Micro to medium Enterprises; 3. JESSICA: Joint European Support for Sustainable Investment in City Areas and 4. MICRO-CREDIT Initiative. 117 2. Committee of Regions and its Role in Regional and Sub-regional Cooperation

The Committee of the Regions (CoR) has a certain role in regional cooperation in the EU. The CoR, like the EU Economic and Social Committee, is the advisory EU institution, which was founded in 1994 and represents sub-regions of the EU member countries. The institution has 344 members and 344 alternate members who serve a 4-year term. Each EU country is represented at the Committee with the number of representatives (from 5 to 24) reflecting the size of the population of the country. CoR members work both at the Committee and in their home regions by continuing with their local or regional government responsibilities and, taking Europea- nisation as a two-way process,9 are being able to ‘download‘ EU-related experiences home and ‘upload‘ regional and local problematique to Brus- sels. The Committee’s activities are guided by subsidiarity, proximity and partnership. As a consultative assembly the CoR provides local and regional authorities possibilities to express their concerns at the level of the European Union. The CoR can to comment upon new EU legislation (since about three quarters of EU legislation is implemented at local or regional level) and involve local and regional government in the debates on about EU domestic and external affairs. The CoR’s structure includes a Bureau, elected from the 60 Committee members, which is responsible for implementation of the CoR’s political programme. There are 6 CoR Commissions, made up of CoR members10: (1)for Ter- ritorial Cohesion Policy, (2) for Economic and Social Policy, (3) for Sustainable Development, (4) for Culture, Education and Research, (5) for Constitutional Affairs, European Governance and the Area of Freedom, Security and Justice, and (6) for External relations and Decentralised Cooperation.11 The Commis- sions examine the proposals on which the CoR is consulted and prepare draft opinions towards the European Commission’s proposals.12 The European Com- mission and the European Council are obliged to consult the CoR whenever new

9 Flockhart, T., Europeanization: the myths and the facts, Public Policy Research, vol. 13, 2, 2006. 10 There are four political groups represented in the CoR, reflecting the main European political families: the Party of European Socialists (PES), the European People’s Party (EPP), the Group of the Alliance of Liberals and Democrats for Europe (ALDE) and Union for Europe of the Nations - the European Alliance (UEN-EA). 11 The CoR has also set up a Committee for Administrative and Financial Affairs and Ad Hoc Temporary Com- mission on the EU Budget Review. The former aims at the improvement of the relationship with the budget authority, in order to ensure that the COR’s priorities are taken into account. The latter body submits to the plenary session a draft CoR opinion on the EU budget review; ensures that the various CoR commissions’ opinions and official declarations are consistent; acts as the political interface with the other institutions concerned and represents the CoR externally throughout the debate on the review of the European financial framework. 12 These drafts are submitted to the CoR’s Plenary Assembly for adoption. If a majority at the plenary session approves it, the draft is adopted as the opinion of the Committee of the Regions and is sent on to the Commission, Parliament and Council. 118

political proposals are made in areas of regional or local level.13 The Commission, the Council and the European Parliament can also consult the CoR on issues of regional or local implications stemming from new EU legislation. The cooperation agreement between the European Commission and the CoR, adopted in November 2005 does not embrace the DG REGIO, the EFTA or the EEA, yet, the agreement outlines the external dimension of the EU. The Committee acts in the spheres of external EU action where local and regional authorities recognize powers both at an institutional level and on the ground. Cooperation with the Commission, in particular, concentrates on such areas as support for the EU enlargement process and participation in pre-accession policy; support for the EU neighbourhood policy; promotion of local and regional democracy in third countries, in particular the candidate countries and neighbouring countries; development and promotion of decentralised cooperation; and cross-border cooperation.14 In terms of sub-regional cooperation, in December 2008 the CoR signed a declaration of common interest15 for 2008-2011 with the Baltic Sea States Coo- peration Council, the Union of Baltic Cities, and the Baltic Sea Islands Network in order to promote cooperation.16 Cooperation has been enlarged to include all Baltic Sea regions’ organizations representing at the local and regional level.17 All three associations will assign one representative to the CoR. The parties will cooperate in the following fields: • Involvement of expertise in selected areas of interest of the CoR; • Dialogue between the European Commission and the Association of Regional and Local Authorities; • Participation in conferences and other activities; • Joint activities in the field of communication and the mutual policy of key events; • Joint activities in relations to the CoR’s responsibility for safeguarding local and regional interests and for monitoring the application of subsidiarity; • Joint efforts to strengthen regional participation in Northern Dimen- sion; and • The development of the EU Strategy for the Baltic Sea Region. In addition, the European Commission established the so-called Dia- logue between the European Commission and the Associations of Regional

�� The areas include economic and social cohesion, trans-European infrastructure networks, health, education, culture, employment policy, social policy, the environment, vocational training and transport. 14 Cooperation Agreement Between The European Commission And The CoR, http://www.cor.europa.eu/ COR_CMS/ui/ViewDocument.aspx?siteid=default&contentid=d9d6dec2-b85e-48c4-a939-dc418e675894 15 Declaration of common interest 2008-2011, http://www.cor.europa.eu/COR_cms/ui/ViewDocument. aspx?siteid=default&contentID=f1335773-1096-4253-b369-bd37dfd5c292, 28 01 2009. 16 The CoR and the BSSC signed similar declaration in February 2007. 17 The BSSSC and the UBC include subregional entities and cities from the only EFTA member country Norway. 119 and Local Authorities.18 The aim of this dialogue is to improve legislation by ensuring the integration of regional and local associations’ viewpoints before the formal decision-making processes start and to ensure a better understanding of the EU’s policy guidelines and to make the EU more transparent and meaningful to its citizens. The European Commission addressed the CoR to cooperate with the associations and to establish the criteria for participation in the dialogue. The Commission also considered the CoR to be the key institution identifying associations of interest and proposing European and other National associations’ relevant subjects to be discussed. Since 2002 the CoR has been playing the main role in the development of this Dialogue by coordinating the preparation of the different dialogues in close cooperation with the Commission and the associations across the EU and beyond its borders. The Dialogue is open to all national and European associations of Regional and Local Authorities. In 2006-2008 there have been ten meetings of the Structured Dialogue between associations of local and regional authorities and members of the European Commission during which issues of common interest were discussed.19 The CoR aimed at a better involvement of the CoR’s partners in its institutional activities and prepared a number of joint action plans with regional and local associations.20 Another EU initiative, though again inward oriented, was the organising of debates on the European institutional change and recent Treaties. After the referendums in France and the Netherlands said ‘no’ to the Constitutional Trea- ty for Europe in 2005, the European Commission launched a so-called ‘3D Plan’ (Democracy, Debate, Dialogue), which aimed at boosting public participation by organising debates on the future of Europe at local and regional level. The European Commission has called upon the CoR to play the main role in this Plan and the CoR appointed a team leader for each pilot country (Portugal, Spain, France, Slovenia, Ireland, United Kingdom, Germany, Hungary, and Denmark) to coordinate its efforts with those of the European Commission delegations to the member states. The CoR was also working in cooperation with its national

18 In line with its commitment made in the White Paper on European Governance, the European Commission adopted a communication in December 2003 on dialogue with associations of regional and local authorities on the formulation of European Union policy (COM(2003) 811 final). This dialogue is a new form of contact, beyond and in addition to the existing methods of public and institutional consultation launched by the Union institutions in the pre-legislative phase. 19Past Dialogue Meetings 2006-2008: http://www.cor.europa.eu/pages/EventTemplate. aspx?view=folder&id=f6c524ce-0d60-4141-977d-389af3852740&sm=f6c524ce-0d60-4141-977d- 389af3852740, 29 01 2009. �� According to the Fact Sheets On The Activities, Representatives And Work Schedules Of European Organisations Representing Local And Regional Authorities, Updated For The First Half Of 2009‘among the countries of EFTA there are the Working Community Of The Central Alps (Arge Alp) with Grisons, St Gall, and Ticino cantons of Switzerland and the Baltic Sea State Subregional Co-operation (BSSSC) with regional authorities from Norway. http://www.cor.europa.eu/cor_cms/ui/viewdocument.aspx?siteid=defaul t&contentid=bac07f91-c90a-4527-b8da-3f4e1ad80858, 29 01 2009. 120

delegations, encouraging them to become involved in this process.21 In 2006 the European Grouping of Territorial Cooperation (EGTC) became a new European legal instrument, which promoted cross-border, transnational, and interregional cooperation.22 Its adoption was both a major change in the legal framework for territorial cooperation because it was the first EU instrument with regulatory scope in the field and because it brought this cooperation between authorities from different European states. From the point of view of law on cross-border cooperation and the precursor of territorial cooperation, this is an entirely new prospect.23 Unlike the structures that governed this kind of cooperation before 2007, the EGTC enables regional and local authorities and other public bodies from different member states to set up cooperation groupings since August 2007. The EGTC members can be any one of the following: EU member states, regional or local authorities, associations, or other public bodies. This initiative enables public authorities to produce joint services, without a prior international agreement. The EGTC organises and manages cross-border, transnational, or interregional cooperation measures, with or without a financial contribution from the EU.24 The CoR has a consultative role in the area of cross-border cooperation and the CoR was very active in the establishment of the EGTC, which has been operational since August 2008. The EGTC has established an Expert Group to analyse and monitor EGTC activities and also serve as a bridge between practitioners and institutions. The Expert Group attempts to monitor the adoption and implementation of provisions at the member state level in order to facilitate the exchange of experiences on the establishment of EGTCs’ at territorial level and also share knowledge of best practices in the field, in order to assist in identifying the potential of EGTC in cohesive territorial development and to improve the communication on EGTC opportunities and challenges at territorial level.25 Another example of the practice of good cooperation is the initiative of the European Commission’s DG for Regional Policy and the CoR to organise the seventh OPEN DAYS event between 5 and 8 October 2009 in Brussels. The purpose of this event is to bring political representatives, decision makers,

21 In the CoR Survey „Communicating - Europe Going Local“ of 2006 there was an overview of the question- naire, where local and regional actors were asked to comment on three principle domains with relation to Plan- D. Among 66 responses there was a contribution from Switzerland (Regio Basiliensis). http://www.cor.europa. eu/pages/EventTemplate.aspx?view=folder&id=bdebadda-9abd-49f5-ba5d-2b6b1750e7c4&sm=bdebadda- 9abd-49f5-ba5d-2b6b1750e7c4, , 30 01 2009. 22 It was established by Regulation 1082/2006/EC of the European Parliament and the Council on the 5th July 2006. 23 Levrat, N. et al., The European Grouping Of Territorial Cooperation, 2007, http://www.cor.europa.eu/ COR_cms/ui/ViewDocument.aspx?siteid=default&contentID=a0ba4bb0-c621-4b36-83c8-2a6aa5db5b4f, 30 01 2009. 24 To carry out these tasks, an EGTC may create its own structure, have assets and hire staff. 25European Grouping of Territorial Cooperation Expert Group, http://www.cor.europa.eu/pages/EventTem- plate.aspx?view=folder&id=4cdd9dc3-783a-4ec2-916a-028dfdb4b61b&sm=4cdd9dc3-783a-4ec2-916a- 028dfdb4b61b, 30 01 2009. 121 experts and practitioners of regional policy and participants from banking, business, civil society organisations, academia, EU institutions and the media to discuss common challenges for European regions; to provide a platform for capacity building in the implementation of the EU cohesion policy and in the management of its financial instruments; to facilitate cooperation; and networking among regions and cities on good practice in regional development.26 Finally, in relation to the EEA and the EFTA, the CoR at times organises conferences and seminars in order to inform local and regional authorities in the new EU-member states about the possibilities of the EEA Financial Mechanism and the Norwegian Financial Mechanism.

3. European Free Trade Association in a Broader Framework of Regional Cooperation

The European Free Trade Association is an intergovernmental organisation set up for the promotion of free trade and economic integration to the benefit of its current four members (Iceland, Liechtenstein, Norway and Switzerland.) The EFTA Convention was signed in Stockholm by Austria, Denmark, Norway, Portugal, Sweden, Switzerland, and the United Kingdom on 4 January 1960. Finland joined in 1961, Iceland in 1970, and Liechtenstein in 1991. In 1973, the UK and Denmark left EFTA to join the European Community. They were followed by Portugal in 1986 and by Austria, Finland and Sweden in 1995. The EFTA Stockholm Convention27 forms the legal basis of the organisation and provides a framework for the liberalisation of trade in goods amongst its members. The then establishment of the EFTA was an economic response to the more politically driven European Economic Community. Relations with the European Economic Community (later the European Community and the European Union) have been important for the EFTA from the very beginning of its existence. In the 1970’s the EFTA States concluded free trade agreements28 with the European Community. The EEA Agreement entered into force in 1994

26 This communication platform has enlisted loyal support from over 7 000 local, regional, national and European decision-makers and experts. 27 The updated EFTA Convention, the Vaduz Convention, was signed on 21 June 2001 and entered into force on 1 June 2002, in parallel with the EU-Swiss Bilateral Agreements. It includes several significant changes of which the most important is the integration of the principles and rules established between the EU and the EEA EFTA States in the EEA Agreement, and between the EU and Switzerland in the EU-Swiss Bilateral Agreements. The Vaduz Convention covers all the important aspects of modern trade and considerably reinforces the ties between the EFTA countries The revised EFTA Convention is updated by the Council on a continuous basis. The purpose of these reviews is to take stock of, and to update the Convention in line with recent developments under the EEA Agreement and under the Swiss-EU Bilateral Agreements. 28 The EFTA has concluded 16 free trade agreements (FTAs) with countries all over the world by 2008. 122

and the EU-Swiss Bilateral Agreement - in 1999.29 The EEA Agreement allows three out of four EFTA Member States (Iceland, Liechtenstein and Norway) to participate in the EU’s internal market.30 Switzerland, is not a member of the EEA, but has an observer status in the EEA structure through its administration of the bilateral Swiss-EU agreements. The EFTA main institutions are the Council, the Advisory bodies, and the Secretariat. The EFTA Council is the governing body, yet without supranational features. It is responsible for intra-EFTA relations and those between EFTA States and third countries. It is also the forum in which the member states consult, negotiate and act together. The activities of the Council try to facilitate the development of links with other states, unions of states and international organisations, and provide political guidance for EFTA’s work, especially in terms of both free trade and the EEA Agreement. The Council is responsible for administrative and budgetary matters within EFTA and meets at ministerial level.31 Nine committees and seven experts groups assist to the Council. There are also advisory bodies at the EFTA: EFTA Consultative Committee (comprising representatives of industry and labour) and the EFTA Parliamentary Committee (comprising members from the EFTA countries’ parliaments). The EFTA is also linked to the EFTA Surveillance Authority and the EFTA Court to be presented below. The EFTA Secretariat headed by the Secretary-General assists the EFTA member states with the input to EU decision-making process. Finally, the Board of Auditors is the supreme auditing authority for the EFTA Secretariat, the EFTA Surveillance Authority and the EFTA Court. It also serves as a point of contact with the Court of Auditors for the auditing of EEA EFTA contributions to the EU budget.32

29 The EFTA today maintains the management of the EFTA Convention (intra-EFTA trade), the EEA Agree- ment (EFTA-EU relations). The EFTA Convention and the EFTA free trade agreements are managed from the Geneva office, the EEA Agreement from the Brussels office. 30 It was originally negotiated between all the EFTA States and the European Commission and its Member States, but Switzerland decided eventually not to join this extensive arrangement. Switzerland has concluded, in addition to its Free Trade Agreement of 1972, seven bilateral agreements with the EU that constitute a framework for economic relations which goes further than the EFTA Convention. Switzerland proposed to Iceland, Liechtenstein and Norway to accord the same treatment to them as to the EU countries, on the basis of reciprocity. http://www.efta.int/content/legal-texts/efta-convention/detailed-overview, 31 01 2009. 31 Between the ministerial meetings the Council meets monthly at ambassadorial level. 32 The Budget Committee also assists the Council on EFTA budgetary matters. 123 4. European Economic Area – a New Area for Regional Cooperation?

The European Economic Area was created on 1 January 1994.33 It currently allows three out of four EFTA countries (Norway, Iceland and Liechtenstein) to participate in the internal market, with no right to vote. The EEA Agreement embraces the so-called ‘four freedoms’, that is, freedom of movement of goods, persons, services and capital.34 The operation of the EEA is based on the principle of homogeneity, which means the integration of acquis communautaire into the EEA Agreement. After the adoption of any European Commission legal act the EEA Joint Committee decides to amend the EEA Agreement. The adoption of EEA rules takes place in the EEA institutions set up by the Agreement. Then the EEA EFTA states implement the EEA rules on the national level. The EFTA states also make financial contributions towards the reduction of economic and social disparities in the EEA. Now the EEA unites 27 EU member states and three EFTA States (Iceland, Liechtenstein, and Norway). Cooperation is being carried out through common activities such as EFTA participation in EU programmes35 and agencies.36 The participation of EEA/EFTA states was beneficial for both sides. While allowing EFTA participants to find EU partners, the programmes also provide an opportunity for the EU to benefit from the expertise and best practices of EFTA states, beside the increase in the programmes’ budget through the financial contributions of the EFTA states to be presented below. The EEA

33 The history of the EEA is closely linked to the development of the Internal Market on the EU side. The idea for the Internal Market was set out in the Single European Act of 1986, under Commission President Jacques Delors who in 1989 proposed an EEA with more structured arrangements in trade and common institutions. The negotiations were initiated in 1990. The EEA Agreement was signed on 2 May 1992 and entered into force on 1 January 1994. Switzerland in a referendum voted to stay out of the EEA; Austria, Finland and Sweden switched side within the EEA, from EFTA to the EU, in 1995; the same year Liechtenstein joined the EEA. http://www.efta.int/content/eea/EURelations/EEAInfo, 31 01 2009. 34 Social policy, consumer protection, environment policy, competition and state aid rules may also be covered under the EEA Agreement, but the Agreement does not cover Common Agriculture and Fisheries Policies (although the Agreement contains provisions on various aspects of trade in agricultural and fish products); Customs Union; Common Trade Policy; Common Foreign and Security Policy; Justice and Home Affairs (even though the majority of the EFTA countries are part of the Schengen area); and Monetary Union. „This is EFTA”, http://www.efta.int/content/publications/this-is-efta/this-is-efta-2008, 31 01 2009. �� Every year, more than 1 500 organisations, public bodies and entities in the EEA EFTA states participate in the numerous EU programmes. The programmes, projects and networks range from youth exchange programmes and research to public health and development of digital content. The EEA EFTA States have access to 17 new EU programmes through the EEA Agreement. Switzerland has access to the Research and Media programmes through their separate bilateral agreements with the EU. Some of the programmes are e.g. Seventh Framework programme (FP7), Lifelong Learning programme (LLP), Competitiveness and Innovation programme (CIP), Employment and Social Solidarity - PROGRESS, Daphne - Combating Violence, Health 2008-2013, Consumer programme 2007-2013, Youth in Action, Culture 2007, MEDIA 2007, Safer Internet Plus 2005-2008, Data Interchange - IDABC, Marco Polo - Transport, EU statistical Programme, The Civil Protection Financial Mechanism 2007-2013, http://www.efta.int/content/eea/eu-programmes, 31 01 2009. 36 European Environment Agency, European Medicines Agency, European Aviation Safety Agency, European Centre for Disease Prevention and Control, European Maritime Safety Agency, European Railway Agency, European Network and Information Security Agency. 124

Agreement provides the EEA/EFTA states with opportunities to contribute to the shaping of EU legislation at the preparatory stage by participating in the European Commission’s experts groups and comitology committees. Experts groups are formed to advise and assist the Commission with the drafting of new laws, which the EU Council of Ministers and the European Parliament adopt later on. Since the EEA/EFTA states have little influence in the EU decision- making, they get involved in the decision-shaping which is the preparatory work undertaken by the European Commission to draft new EU legislation. The Commission is obliged to ask for an advice from external sources when making proposals for new legal acts. According to the EEA Agreement EEA/ EFTA experts may react to initiatives from the Commission by participating in European Commission committees, expert groups and advisory bodies, providing EEA/EFTA comments and adopting resolutions. The EEA/EFTA states’ representatives participate in comitology committees, programme committees and other committees in very specific areas. The comitology committees assist the Commission to establish subsidiary legislation and to bring into effect a broader piece of legislation. The programme committees are responsible for the development and management of EU programmes outside the four freedoms. The participation of EEA/EFTA experts in the aforementioned EU committees ensures an exchange of information about the necessity to incorporate legislation into the EEA Agreement and to assist the EEA/EFTA countries in implementing such legislation. Participation in committees helps to influence the development of the acquis and the management of EU programmes. There are additional three and EEA-related EFTA institutions: the Stan- ding Committee of the EFTA States, the EFTA Surveillance Authority and the EFTA Court. The first one serves as a forum in which the EEA/EFTA states consult one another and arrive at a common position before meeting with the EU in the EEA Joint Committee. It is made up of the Ambassadors of Norway, Iceland, and Liechtenstein to the EU and observers from Switzerland and the EFTA Surveillance Authority.37 In turn, the Surveillance Authority ensures that Iceland, Liechtenstein, and Norway respect their obligations under the EEA Agreement. The EFTA Court deals with the EEA/EFTA states and is concerned with infringement actions brought by the EFTA Surveillance Authority against an EEA/EFTA state, with regards to EEA rules. The Court also handles the settlement of disputes between two or more EEA/EFTA states.38 The two-pillar structure with the EEA/EFTA institutions represents the institutional functioning of the EEA. Key decisions concerning the EEA are taken by four joint EEA bodies (1) the EEA Joint Committee, (2) the EEA Council, (3) the EEA Joint Parliamentary Committee, and (4) the EEA Consultative Commit- tee). The EEA Joint Committee is responsible for the management of the EEA

37 The Committee’s sub-structure consists of five subcommittees, under which there are several working groups. 38 It also hears appeals against decisions taken by the EFTA Surveillance Authority and gives advisory opinions to courts in the EEA EFTA states on the interpretation of EEA rules. 125

Agreement. This forum helps to exchange views and to incorporate European Commission legislation in the EEA Agreement. The Joint Committee is made up of ambassadors of the EEA/EFTA States, representatives from the European Commission and EU Member States.39 The EEA Council is composed of EEA/ EFTA foreign ministers, the EU is represented also by foreign ministers in the troika format (past, present and future EU Council Presidencies), and officials responsible for EU’s external relations. The EEA Council provides political impetus for the development of the Agreement and guidelines for the EEA Joint Committee. A political dialogue at the Council takes place on a wide range of foreign political issues.40 The joint EEA institutional set-up also encompasses the EEA Joint Parliamentary Committee and the EEA Consultative Commit- tee.41 Both committees are consultative bodies. Whereas the former comprises members of the national parliaments of the EEA/EFTA States and Members of the European Parliament, the latter is made up of members of the EFTA Consultative Committee and the European Economic and Social Committee. The three EEA/EFTA countries make their financial contributions to the EEA in return for possibilities to enjoy the benefits of the enlarged internal market. The financial mechanisms were established in 2004 in connection with the penultimate EU and the European Economic Area enlargement. Through the mechanisms a wide range of public authorities and institutions, organisations, and businesses across Central and Southern Europe are eligible for grant support to realise projects for the public benefit. Institutions from Iceland, Liechtenstein and Norway can participate as project partners. The EEA financial mechanism and the Norwegian financial mechanism consist of the contributions of Iceland, Liechtenstein and Norway to cohesion across the EEA area. The EEA/EFTA states participate in the reduction of economic and social disparities between the regions of the EEA through the financial mechanisms.42 Over a five-year period through April 2009, the EEA Financial Mechanism will make available 672 million euro assistance to 15 beneficiary states in Central and Southern Europe. Norway – as the largest donor – is contributing close to 95 percent of the funding. The Norwegian Financial Mechanism will make available an additional €567 million to ten countries that joined the European Union in 2004.43

�� Four subcommittees assist the Joint Committee (on the free movement of goods; free movement of capital and services including company law; free movement of persons; and horizontal and flanking policies). Numerous expert and working groups report to these subcommittees. The EEA Joint Committee also presents an annual report on the functioning of the EEA Agreement. http://www.efta.int/content/eea/institutions/eea-joint-committee, 01 02 2009. �� As part of an assessment of the overall functioning of the EEA Agreement, the EEA Joint Committee prepares a progress report on its activities for each EEA Council meeting. The EEA Council also takes into consideration resolutions adopted by the EEA Joint Parliamentary Committee and the EEA Consultative Committee. http://www.efta.int/content/eea/institutions/eea-council, 01 02 2009. �� In both these Committees Switzerland is an observer. 42 Priority for financing is attributed to academic research, conservation of European cultural heritage, development of human resources, health and childcare, protection of the environment, sustainable development, aquis communautaire, Schengen and the judiciary, cross-border activities and regional policy. 43 Norway will also contribute €68 million in bilateral cooperation programmes with Bulgaria and Roma- nia. 126 In Lieu of Conclusions: Where are the Tangents of Cooperation?

With the Lisbon Treaty of the EU, a High representative of the EU for foreign and security policy is responsible for external relations within the European Commission and for coordinating other aspects of the Union’s external action and conducts the Union’s common foreign and security policy. However, the Directorate General for External Relations (DG RELEX) contributes to formulation of such policy and keeps relations with four other directorate generals, among which DG REGIO is not mentioned. However, the overview of existing structures and mechanisms for regional cooperation policies, by specifying the roles and responsibilities of the European Commission’s DG REGIO and the CoR, help to disclose the opportunities and challenges to furthering the EU’s collaboration with regional and sub-regional bodies at the EFTA and the EEA. New cooperative practices to be outlined might expand a circle of European partners towards the countries of the EFTA. The logic of differentiating ‘European neighbours’ (countries with European identity, in geographical Europe and similar patterns of interrelated history) and ‘neighbours of Europe’ (countries without or with feeble historical and socio-cultural links to the EU and/or outside geographical perimeter of Europe) can be extended to the four EFTA states as to ‘European countries’. The ‘reluctant Europeans’, as Iceland, Norway, Lichtenstein and Switzerland are sometimes referred to, could, if they wanted, contribute to the development of European identity and, perhaps, welfare, with good cooperative practices and reducing democracy deficit, let alone the strengthening efficiency of political and institutional networking across Europe. Cooperation can change perceptions of partners involved about themselves and the others. Therefore it is relevant to establish dimensions and vectors in which the greatest synergy between the EU and the EFTA could be achieved. One could initially consider perspectives of deepening ‘soft’ EU integration without full membership, in case the EU and the EFTA developed new pilot collaborative projects with certain institutional foundation. The EU’s political and economic gravity and accumulated experience enables the organisation to come up with initiatives for revised cooperation. On the other hand, after two last EU enlargements and the launch of the Eastern partnership in May 2009 may face scepticism, if not a resistance, from the southern European states. In essence, modi operandi of the DG REGIO, the CoR, on the one hand, and the EFTA and the EEA, on the other hand are quite incompatible in principle. The former entities are preoccupied with cohesion and regional cooperation mostly among the countries and sub-national units of the European Union, whereas the latter two are primarily driven by the participation in the common internal market. Nevertheless, these crossing each other functional trajectories can make the ends meet only given the existent political will to develop cooperation. Against the backdrop of the current economic and financial crisis, a political context for enhanced collaboration became more favourable. Iceland, 127 which was severely hit by the economic hardship started seriously considering EU membership perspectives. In turn, in a referendum of February 2009, Swiss voters have come out in favour of extending to Switzerland the free movement already enjoyed within the European Union by citizens from Romania and Bulgaria. The approaching of the EFTA countries towards the EU is an opportunity to discern other dimensions for cooperative practices. The DG REGIO is oriented towards reducing differences between countries and regions and towards strengthening cohesion with the EU. The Cohesion programmes for 2007-2013 do not mention the EFTA or the EFTA EEA states. Actually, none of the DG REGIO programmes and instruments deals with the European Economic Area or the EFTA countries. The only instrument for Pre-Accession Assistance focuses only on EU candidate countries (Croatia, Turkey and the Former Yugoslav Republic of Macedonia). The DG REGIO Fifth Progress Report on Economic and Social Cohesion does not consider closer cooperation with the EFTA, the EEA and the CoR has not been taken into consideration either. Still, one of the aims of the EU cohesion policy is the promotion of cross-border cooperation, which could be oriented towards, as the DG REGIO annual management plan of 2009 states, ‘potential candidate countries’.44 Nowadays, the concept of a ‘border’ in international relations acquires different meanings: borders can separate, but they can also unite. Regions on a national or sub-national level have nowadays two perspectives: sovereignty- bound (modern45) and sovereignty-eroding (postmodern46).47 Postmodernism recognise the abundance of actors in international politics and soft security problematique. Regions can be built in a bottom-up manner, that is, not only by states, but also by sub-state actors as NGOs, cross-border regions, universities, municipalities, counties, and so forth. Postmodernism downplays political and collective homogeneity and gives a ticket to multiple identities which can rather well cohabitate. Political actors can have overlapping, changing or divergent collective identities. Therefore, it is worth extending cross-border cooperation with ‘European countries’ within the DG REGIO framework and

44 Actual Management Plan, http://ec.europa.eu/dgs/regional_policy/document/amp2009_en.pdf, 02 02 2009. 45 Sovereignty is a powerful principle of activities of a modern state. This principle has become established with the peace accord of Westphalia in 1648. Then sovereign states emerged as key actors in international politics. 46 Postmodern features of international politics are fuzzy state borders, networking, asecurity, and post- sovereignty Fuzzy state borders refer to irrelevance of state boundaries, since borders have to unite – not separate. Networking is understood as a means to develop channels of communication among different sub-state actors. Asecurity refers to a situation when security is taken away from the agenda of cooperation among states. Finally, post-sovereignty speaks of pooling more authority to sub-state actors who could be more independent of the state which, in turn, is not afraid to “loosen” control over sovereignty and territorial integrity while dealing with partners. 47 Acharya A., Regionalism and emerging world order: sovereignty, autonomy, identity, in Breslin Shaun, Christopher W. Hughes, Nicola Phillips and Ben Rosamond, eds, New regionalisms in the global political economy, London, Routledge, 2002, 30. 128

employing CoR expertise of sub-national level. In case there is political will among ‘reluctant Europeans’ for increased cooperation and moving closer to the EU, then the DG REGIO could reconsider its geographical vectors in the usage of pre-accession instrument. The DG REGIO is also responsible for EU Solidarity Fund which could be employed, if needed, for the creation of positive image of the EU in the EFTA countries. Every now and then the DG REGIO and the CoR institutions jointly issue publications about regions and cities in the EU.48 The DG REGIO could extend experiences of cooperation with the CoR by expanding the geographical scope of publications into the EFTA states. This would increase European awareness, exchange of information and networking possibilities in national and sub-national levels across a wider European area. Moreover, the Directorate General in cooperation with the Committee of Regions organises conferences devoted for regional policies, their implementation and networking, but the conferences do not encompass cooperation with EFTA countries or EEA issues so far.49 Conferences could be regarded as an additional opportunity for pooling expertise both from the EU and the EFTA countries, as both parties face very similar political, economic, social challenges, let alone they share European identity. The update of opinions adopted during the four-year term of CoR office (2006-2010) and CoR’s political priorities for 2008-2010 reveal virtually non-existent links with DG REGIO, EFTA countries, or EEA cooperation.50 This notwithstanding, although the Committee of Regions is a consultative institution, it can become one of the vehicles for the approach between the EU and EFTA. The advisory status of the EU’s CoR does not pose any dangers to the reduction sovereignty to the outsiders and therefore the Committee could consider employing its structure for regional cooperation with the EFTA states. One of the key CoR’s bodies is its Bureau, which consists only of EU member states. In such a case, granting an observer status of the integration of the EFTA’s sub-national representatives in the Bureau would broaden local and regional appeal and move political consultations beyond the issues of internal market. The same could be done, in a coherent and timely manner, with corresponding CoR’s institutions as CoR Commissions, plenary sessions and party groups. Institutional cohesion at the sub-national level would thus increase and ‘democracy deficit’ would diminish, as new partners would be able to follow and comment upon the EU decision-shaping and decision-making which might affect their interests. Besides, with the Lisbon treaty the CoR’s status increases

48 For example, „Regions & Cities Of Europe - Newsletter Of The Committee Of The Regions - Special issue in association with the European Commission Regional Policy Directorate-General - November 2007“ http://www.cor.europa.eu/migrated_data/opendays2007.pdf, 03 02 2009. 49 Regions for Economic Change: Exchanging good practice between Europe’s regions, http://ec.europa.eu/ regional_policy/cooperation/interregional/ecochange/index_en.cfm, 03 02 2009. 50 Opinions and resolutions: http://www.cor.europa.eu/pages/DocumentTemplate. aspx?view=folder&id=f31fdade-9fac-4462-a3ea-07fd71019b44&sm=f31fdade-9fac-4462-a3ea- 07fd71019b44, 03 02 2009. 129 as the Committee would become able to address the European Court of Justice. In order to discover the opinions of experts and policy-makers from the EFTA states about multi-level governance and prospects for cooperation between the EU and the EFTA the CoR and the DG REGIO could invite EFTA participants into ‘Open Days’ events (European Week of Regions and Cities) organised by the DG REGIO and the CoR. The acquired expertise could pave the way for drafting new political initiatives in the field of enhanced cooperation. Another political project, the European Grouping of Territorial Coo- peration, in principle opens a gate for closer involvement of the EFTA states. The EGTCs can be established at the EU’s external borders, provided that the legislation of the non-EU countries or agreements between the latter and member states allow it. The EGTC can even address the 2007-2013 and later programming periods asking to finance new projects of cooperation and convene experts to debate cross-border cooperation. Some non-EU European countries, notably Norway and Switzerland, have for a long time been involved in cross-border cooperation with their neighbours and it is quite likely that these relations might continue and intensify. For example, there is a cross- border urban project around Geneva (thus between Switzerland and France) that inevitably generates closer cross-border cooperation links at this external border of the EU.51 The CoR has prepared a number of joint action plans with regional and local associations, but these plans have next to nothing to do with the EFTA states despite the participation of the Norwegian and Swiss sub-national bodies in two associations. Therefore, the Committee could show more political proclivity in the elaboration of the joint action plan towards the EFTA countries which are a part of the associations the CoR collaborates with. Another sub-national dimension of extended cooperation functionally as well as geo- graphically could be the Covenant of Mayors, which does not include any of the EFTA state. The Covenant has been established by the EU with the aim to contribute to the sustainable urban energy usage, but could be used as a forum for extended cooperation with the EFTA representatives. As for the EFTA and the EEA frameworks, they possess certain features to be applied for cooperation with the EU institutions. Activities of the EFTA Council endeavour to facilitate the development of links with other states, unions of states and international organisations. As a ministerial/ambassadorial forum it could invite the responsible EU representatives to participate in the debates surrounding issues of common interest and all four EFTA countries would be represented in the political discussions. The European Economic Area from its perspective does not foresee the direct involvement of the DG REGIO or the CoR either. However, the financial contribution from EFTA/EEA countries target the reduction of social and economic disparities in the EEA and this is

51 Levrat, N. et al., The European Grouping Of Territorial Cooperation, 2007, http://www.cor.europa.eu/ COR_cms/ui/ViewDocument.aspx?siteid=default&contentID=a0ba4bb0-c621-4b36-83c8-2a6aa5db5b4f 30 01 2009. 130

compatible with the aims of the DG REGIO. Such a common ground serves as a favourable background for potentially developing compatible approaches in increasing political cohesion across the EEA. In conclusion, the analysed network of the EU, the EFTA, and the EEA institutions has a potential to link interrelated issues, to sustain the exchange of information, and to induce partners involved to consider actions for common objectives. However, the trajectories between the institutions studied do not possess too many tangents due to different goals, functions, and responsibilities. Lithuania’s Eastern Neighbourhood

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Liudas Zdanavičius* General Jonas Žemaitis Military Academy of Lithuania

Impact of the Global Financial Crisis on Russia’s Foreign Economic Policy

This article examines how the global financial crisis has affected Russia’s foreign economic policy. An assessment of the crisis on Russia’s economy is given, as well as Moscow’s undertakings to strengthen its position in the global economic system: aspirations to an take active part in the new global financial order making process, plans to create an international financial centre in Russia, and strengthening of economic integration between CIS countries.

Introduction

Russian leaders stress that the increased economic power has significantly improved the ability of this country to increase its influence on global processes. Moscow sees itself not just a passive observer of the international economic processes, but also as an active player in this field. Therefore, the primary purpose of this article is to evaluate how these Moscow aspirations are affected by the global financial crisis. To start, an assessment of how this crisis affected the Russian economy and weakened its economic power is given. In addition, the article analyzes the means by which (in addition to manipulations with its major energy exporter status1) Moscow tries to increase its influence within on the global economic processes. The article is focused on the Kremlin’s efforts to participate in the new global financial architecture creation process, create potent international financial centre in Russia and accelerate economic integration projects in the CIS. Before beginning the analysis of Russian foreign economic policy, it is important to point out that it very controversial. At the same time, in the Kremlin’s actions we can identify two main, often contradictory, directions: • Realistic – neoimperial: the main aim of this direction is to recover for Russia the positions USSR had in the international political system

∗ Liudas Zdanavičius is a lecturer of the Political Science Department of the Military Academy of Lithuania. Address: Šilo 5A, LT-10322, Vilnius, Lithuania, tel. (+370 5) 2103569, e-mail: [email protected]. 1 While traditionally researchers, who analyze the economic component of Russian foreign policy, are focused on Moscow’s actions in the field of export of energy resourses. This is because energy-related issues have very big importance in Russian foreign policy. However, it is worth to pay attention to other, often neglected aspects of Russian foreign economic policy. 134

in the Cold war period. In order to achieve this goal, Russia seeks to maximize its power and to have maximal possible influence on both regional and global processes. Such aims are clearly stated in the most recently published Russian strategic documents - “The Russian Federation Foreign Policy Concept” (made public in July, 2008) and “The National Security Strategy of the Russian Federation” (made public in July, 2009). These documents and public speeches of Russian leaders’ show that Moscow continues to declare its allegiance to the vision of multi-polar world. A world where there are several strong centres of power (one of them, obviously, is Russia) is a much fairer and safer than the world dominated be the only one centre of power - the United States. Kremlin is annoyed by the NATO enlargement eastwards and expansion of Western countries influence in the “the traditional zone of Russia’s interests” - CIS area2. The existing world economic order is perceived as unjust and serving only the developed Western countries, and particularly American, interests. Especially since the West has no interest to change the status quo. The Foreign Policy Concept of the Russian Federation unequivo- cally states, that “the West, realizing that it may lose the monopoly control of the globalization process tries to “withhold” Russia”3. The meaning of this statement is obvious – West, in Moscow’s opinion, has no interest in the Russia’s influence growth. So as we can see in the official rhetoric of the Kremlin, Russia is shown as a victim of Western exploitation. In this case, Moscow’s rhetoric is similar to the provisions of dependency theories on the unfair nature of the Global Capitalistic system and the need to transform this system to more effective and providing equal opportunities for all players. • Neoliberal: in line with neoliberal ideology, which dominates global economic system, Russia positions itself as a state, “which plays under the general rules of the game”. The main objective of this component of Kremlin’s foreign economic policy is to achieve successful integration of Russia into the global economic system. The main means to achieve that – neoliberal domestic and foreign economic policy. How to explain this phenomenon of the Russian foreign policy, when the Kremlin fights with “unfairness” of global economic system and at the same time declares loyalty for neoliberal “rules of the game”, which in essence is the base for these unfair imbalances? Why are simultaneous acts of clearly neoliberal (accession to the WTO, tax reductions etc.) and non-liberal (such as strengthening of the state influence over the economy) carried out?

2 Jellinek R., Russia and the global Meltdown: domestic and foreign policy responses to the international financial crisis, Moscow: Carnegie Endowment, 2009, p. 28–36. 3 The Foreign Policy Concept of the Russian Federation, http://www.mid.ru/ns-osndoc.nsf/0e9272befa342 09743256c630042d1aa/cef95560654d4ca5c32574960036cddb, 2008 07 12. 135

First, this ambiguity could be explained by the hypothesis, that Russian leaders are not the heads of the strict pyramid of power, but just try to balance different interest groups in the country ruling elite. Therefore, domestic and foreign economic policy is based not on the thorough planned. Each action is just result of the interactions between competing interests in the ruling elite. Among experts is popular the theory that in the Russian ruling elite there are two main competing forces – “siloviki” (power olligarchy), and “liberals” (sometimes called “civiliki”4). One of the major differences in their opinions is - an approach to relations with the West5. Russian policy in the financial field, is to a large extent carried out according to the strictest canons of neo-liberalism. Thus one can argue that it is dominated by liberals. Ministries of Finance and economy, the Central Bank and some other institutions are dominated by the strict followers of the monetarism ideas (according to George Soros terminology – market fundamentalists). The dominance of neo-liberalism in Russia is largely determined by the historical circumstances. In 1992-1998 Russian economic policy was highly influenced by the representatives of the International Monetary Fund (IMF) and the World Bank. These organizations during the nineties strongly adhered to the “Washington Consensus” economic policy (neoliberal economic policy recipes, which should lead (at least theoretically) any country in the world to the success in the global economy), so the Russia was not an exception. This strongly influenced the Russian scientists and officials approach to the management of the economy. Dominance of neo-liberalism in Russia can explained and from the viewpoint of the “dependency” theory. In this case, neo-liberal ideology is one of the ways through which the West is manipulating the peripheral economic policy. For example, the promotion of liberalization of the financial markets will open doors for expansion of the Western companies. It may be noted that both the Western media and international financial organizations (World Bank and IMF), even in times of crisis, welcome the neo-liberal component of the Russia’s economic policy components. However, it is clear that such a dominance of neoliberals could be easily removed by political will. So, such dominance is comfortable for the most of Russia’s ruling elite members. It opens possibilities for “capital flight” abroad, corruption, etc. For example, financial reserves accumulated in 2004-2008 as a result of strict monetarian policy in 2008-2010 were used by the Kremlin to support the businesses of affiliated oligarchs. Second, ambiguity of Russia’s foreign economic policy can be understood as a planned action, which attempts to combine the most efficient components neoliberal and neoempiric rhetoric and actions. It is possible, that Russia tries

4 Stratfor, The Kremlin Wars (Special Series), Part 3: Rise of the Civiliki, http://www.stratfor.com/memberships/147752/analysis/20091024_kremlin_wars_special_series_part_3_rise_civiliki, 2010 10 24. 5 Tsygankov A., “Russia`s foreign policy” in Wegren S., Herspring D., eds., After Putin`s Russia: past im- perfect, future uncertain. Lanham: Rowman & Littlefield Publishers, 2010, p. 227–229. 136

to use in the relations with the West at the same time and “the carrot” and “the stick”. It is likely that the Russian authorities understand that the possibilities to break the existing rules of the game have their limits. On the one hand Russia has limited resources, which are not enough, at least at this the moment, to become the dictator of the rules of the game in global economy. On the other hand, too much confrontation with the West could severely affect interests of the Russian companies and individual members of the ruling elite, which have broad ties with the Western countries. The economic crisis has once again clearly demonstrated that Russia’s economy is closely linked to processes, which are taking place on a global economic system.

1. Impact of the Global Financial Crisis on the Russian Economy

Before examining the Kremlin’s foreign economic policy changes after the beginning of the global financial crisis, it is worth analyzing how this crisis has affected the Russian economy. Are trends of Russia’s economic development favourable for Russia’s aspirations to become one of the major centres of global power? Russian leadership has repeatedly stressed that the country managed to overcome the economic turmoil, which followed the collapse of the Soviet Union. For example, the future president Dmitry Medvedev, in the beginning of 2007 with the pride declared that Russia in the near future will become one of the five largest economies in the world’s on in terms of the size of the GDP6. From 1999 to the beginning of 2008 the Russian economy has demonstrated excellent growth. Every year GDP, industrial output, investment, population incomes has grown at the rapid pace. For example, the country’s GDP during this period increased by 93 percent, while the nominal income of the population - more than 10 times (on the other hand, the annual inflation rate during this period was never less than 10 percent). The public external debt decreased by more than three-fold - from 153 billion U.S. dollars in 1999 up to 43 billion U.S. dollars in the October 2008. During the same period, Russia’s foreign reserves increased from 11 to nearly 600 billion U.S. dollars7. It should be noted that Russia’s strong macroeconomic performance was not the result of the efficient economic policy, but the rapid growth of the oil and other raw material, which are the main Russia’s export goods, prices. In the

6 Reuters, Davos - Top Kremlin official Medvedev woos world forum, Jan 27, 2007, http://www.reuters.com/ article/idUSL2726905720070127, 13 07 2010. 7 Банк России, Внешний долг Российской Федерации в 2008 году, http://www.cbr.ru/statistics/print. aspx?file=credit_statistics/debt_currency_08.htm&pid=svs&sid=vdRFviv . [The Bank of Russia, Foreign debt of the Russian Federation in 2008] – in Russian. 137

1997-1999, the average price of the Russian “Urals” brand of oil was between 9 and 20 dollars per barrel. In July, 2008 it exceeded the 140 U.S. dollars per barrel threshold for a short period of time8. Country’s successful economic development made its leadership to think that Russia will be not affected by the global financial crisis. In summer 2008 Medvedev and Putin have repeatedly stated that Russia is a quiet backwater bay in the ocean of the global economic crisis. This optimism is driven by the fact of the record high oil prices and the huge financial reserves, accumulated by Russia to that time. However, in September 2008 it became evident that the economic crisis has badly hit “the silent bay”. This influences by the three main factors: First, in the global markets began a rapid decline of Russia’s main export commodity prices. For example, the price of oil has fallen from a record 148 U.S. dollars per barrel in July, 2008 to the 35-40 U.S. dollars at the end of the same year. Prices of metals, fertilizers, timber, grain and some other commodities also declined sharply. This led to a significant drop of export incomes of the Russian companies and later this led to the decline of states tax revenues. Second, the domestic and foreign investor began to “run” from Russia’s financial markets. In 2008, almost 130 billion U.S. dollars were withdrawn from Russia9. It should be noted that in the 2004-2007 the direction of capital movement was opposite and “hot money” were flowing to the country’s financial markets. Alone in 2007 more than 83 billion of U.S. dollars came to Russia as portfolio investment. Capital flight was ignited by the Russian - Georgian military conflict (the fear of a major Russian-Western relations degradation) and the fear of sharp Russian economic situation - deterioration - driven by a sudden drop in export commodity prices. Third, the global financial crisis and fear of Western banks that fall of the commodity prices will significantly reduce the export revenues of Russian companies’, and also drastically worsened borrowing conditions for the Rus- sian companies and banks in the Western capital markets. The Russian foreign corporate debt in October 2008 exceeded 500 billion U.S. dollars10. A significant share of this debt was short term liabilities, for repayment of which it was necessary to obtain new loans. Therefore, serious risks for the country’s biggest companies and banks (including governmental) bankruptcies has arisen. The economic crisis in Russia began at the end of August 2008. The first signal was the stock market crash. Russia’s RTS stock index fell from its maximum value in 2487 points in May, 2008 to less than 500 points in December,

8 U.S. Energy Information Administration, World Crude Oil Prices, http://tonto.eia.doe.gov/dnav/pet/ pet_pri_wco_k_w.htm. 9 Банк России, Платежный баланс Российской Федерации за 2008 год, http://www.cbr.ru/statistics/ print.aspx?file=credit_statistics/bal_of_paym_an_08.htm&pid=svs&sid=pbDK_an . [The Bank of Russia, Balance of payments of the Russian Federation in 2008] – in Russian. �� Банк России, Внешний долг Российской Федерации в 2008 году, http://www.cbr.ru/statistics/print. aspx?file=credit_statistics/debt_08.htm&pid=svs&sid=vdR. [The Bank of Russia, Foreign debt of the Russian Federation in 2008] – in Russian. 138

200811. Already in the fall of 2008 the country’s banks and companies faced serious financial problems and were saved from bankruptcy only by urgent intervention of the government and the Central bank. In October 2008 the crisis reached the country’s so-called “real sector” (industry, trade, transport, agriculture and other non-financial economic sectors). A sharp decrease of industrial output, freight amounts, and retail turnovers began. This was followed by the sharp increase in the unemployment figures. According to official data, GDP in 2009 compared with 2008, decreased 7.9 percent. Industrial output decreased by 10.7 percent12. The fact that the economic consequences of the crisis in Russia were one of the deepest among the G-20 countries was in part the result of a failure of the government and the central bank’s anti-crisis policy. While the huge funds were spent on anti-crisis measures, the biggest part of this expenditure went to the country’s largest banks, public companies and oligarchs affiliated with the Russia’s ruling elite. A good example of such inefficiencies was the decision to proceed with the gradual devaluation of the national currency. In the winter 2008-2009 of the ruble exchange rate against the U.S. dollar has been gradually reduced from 24 to more than 36 rubles per U.S. dollar. Meanwhile, as the devaluation was carried out gradually, from that process benefited the commercial banks close to the government, which earned between 30 and 60 billion of U.S. dollars. On the other hand, the Central bank lost on third of its foreign currency reserves (around 200 from nearly 600 billion of U.S. dollars). Russia’s economy was saved from total collapse by the fact that in spring 2009 oil and other export commodities prices began to grow. Till the beginning of 2010 oil prices reached 70-80 U.S. dollars per barrel. Similar oil prices were found in 2007 when Russia’s economy has boomed. An increase of oil and other commodity prices helped the Russian government to stop the decline of foreign reserves and increase revenues for the national budget. From the spring 2009 till the end of the same year, the ruble exchange rate grew from 36 to less than 30 rubles per U.S. dollar. Stock Exchange index RTS has grown from 500 points in the end of 2008 till 1534 points in March 201013. These indicators and the slowdown of country’s economic decline encouraged Russia’s officials to declare that the economic crisis is over. This position is supported by the IMF and the World Bank, whose forecasts predicts that in 2010 Russia’s GDP will begin to grow again14.

�� РБК, Индекс РТС, http://stock.rbc.ru/demo/rts.1/daily/RTSI.rus.shtml?show=2Y . [RBC, Russian Trading System Stock Exchange index] – in Russian. �� Федеральная служба государственной статистики, Основные статистические показатели, http://www. gks.ru/wps/portal/!ut/p/.cmd/ces/.exp/7_0_86J/.miid/null/.exps/true/.def/false/.scr/Home/_s.7_0_A/7_0_8QL/_ th/J_0_LV/_s.7_0_A/7_0_8QL/_me/7_0_86N-7_0_7UL-7_0_7UJ-7_0_A#7_0_86J [The Federal State Statistics Service of the Russian Federation, Basic statistical indicators] – in Russian. 13 РБК, Индекс РТС, http://stock.rbc.ru/demo/rts.1/daily/RTSI.rus.shtml?show=2Y. РБК, Индекс РТС, http://stock.rbc.ru/demo/rts.1/daily/RTSI.rus.shtml?show=2Y [RBC, Russian Trading System Stock Ex- change index] – in Russian. 14 International Monetary Fund, World Economic Outlook (WEO) Sustaining the Recovery, http://www.imf. org/external/pubs/ft/weo/2009/02/index.htm. 139

However, both opponents of the government (for example, M. Delya- gin, V. Milov, N. Kritchevsky etc..) and some officials (for example, Minister of finances A. Kudrin, and CEO of the state owned bank Sberbank G. Gref) believe that Russia may face a second wave of the crisis. It may be induced by the following factors: • Despite some good dynamics in the economic development of Rus- sia, financial situation of most banks is quite difficult. Rapid growth of so called “bad loans” could lead to the wave of bank bankruptcies. In such case a situation could be stabilized only by rapid governmental intervention. • Difficult situations in the public finances and the pension system. The Rus- sian government in the expectation that the crisis will be short-term, decided not to reduce budget spending. Difficult budget situation (the deficit for 2009 was 6 percent. GDP in 2010 projected 6.7 percent of GDP15) is exacerbated by the decision to significantly raise the size of the old-age pensions. The budget deficit is financed from financial reserved accumulated in the period of high oil prices. The Finance Ministry estimates suggest that if the current level of budget expenditures will be preserved, Russia’s reserve fund, from which budget deficit is financed, will be exhausted in 2011. The long-term economic outlook for Russia is even grimmer. The economic crisis has demonstrated that Putin’s reign, despite the huge increase in oil and other commodities export revenues, thus failed to resolve the country’s fundamental economic problems. Good macro-economic indicators only hid core structural problems of the Russian economy. Economic crisis again raised them to the surface. These fundamental problems of the Russian economy should be identified: • Dependence on raw materials (especially oil and gas) exports. Although country leaders from the moment when V. Putin came to power in 1999 constantly talking about the need to reduce the country’s economic dependence of Russia also failed to reach this goal. By contrast, share of oil, gas and other energy resources in the total export rose from 54 percent in 2000 to 66.7 percent in 200916. • This implies that Russia, despite ambitions to be one of the world’s

�� Федеральная служба государственной статистики, Социально-экономическое положение России, http://www.gks.ru/wps/PA_1_0_S5/Documents/jsp/Detail_default.jsp?category=1112178611292&elem entId=1140086922125 [The Federal State Statistics Service of the Russian Federation, Socio-economic situation of Russia] – in Russian. �� Федеральная служба государственной статистики, Внешняя торговля Российской Федерации (по данным таможенной статистики), http://www.gks.ru/wps/portal/!ut/p/.cmd/ces/.exp/7_0_8F4/.miid/ null/.exps/true/.def/false/.scr/Home/_s.7_0_A/7_0_876/_th/J_0_LV/_s.7_0_A/7_0_876/_me/7_0_7UL- 7_0_7UJ-7_0_A# [The Federal State Statistics Service of the Russian Federation, Foreign trade of Rus- sian Federation (custom statistics)] – in Russian. 140

economic leaders, has to settle with the status of a raw material supplier for the West and China. Dependence on oil and gas exports makes Russia highly dependent on price fluctuations of these commodities in the world market. Moreover, even at high prices, revenue from energy and other raw materials export is not enough to ensure a high standard of living for the majority of the population. • Especially since the future outlook for the energy and raw materials export is not very favourable for Russia. On the one hand, the breakthrough in shale gas extraction technologies has significantly increased the supply of natural gas in the U.S. market. This has led to a fall in natural gas spot prices in the markets of Western countries. It is likely that after beginning of active exploitation of the shale gas fields the slate of in the EU, Ukrainea and China outlook for Gazprom’s exports could be very grim17. On the other hand, it is not clear whether Russian energy companies will be able to avoid a major fall in oil and gas production volumes, which could result from currently exhaustion of currently operated fields and inadequate investment in new mining projects. • It should be noted that the economic crisis has only further aggravated the situation of the Russian industry, producing high value-added products. Even the last significant remnant of the Russian high-tech sectors - defence industry – is experiencing not the best times, despite constant growth of government spending on weapons acquisition. In the near future Russia may lose the capability to produce most of high- tech weaponry and will be forced to rely on weapon import. • Even worse is the situation of science. In 2008 the Russian economy used 2.5 times less homemade technologies than in 2000. Between 1992 and 2008 share of Russian patents in the total number of patents issued worldwide declined from 4.6 to 2.6 percent18. • Worn out infrastructure and production facilities. In 2000-2008, despite tremendous revenues from exports, the Russian economy continued to suffer shortages of investment in infrastructure, industrial equipment and other fixed assets. For example, more than half of the railways were first built before 1916, housing and utilities funds are worn more than 70 percent. In some industries, up to 90 percent of equipment is worn out. So actually Russian economy functions using Soviet era legacy (heritage?). Some experts stress that the moment is coming at the fast pace, when the Soviet era assets will perish en masse and Russia will face a number of technogenic catastrophes, which consequences could be difficult to solve even using a huge investments. It is likely that the major accident in Sayano–Shushenskaya Dam certainly will not be the last such disaster. • Demographic problems. The Russian population in 2001-2009 decreased

17 The fall of demand for natural gas and uncertain prospects for its growthe in the future Gazprom was forced to postpone the Shtokman gas field development works. 18 Иноземцев В., “Modernizatsya.ru: Что осталось на трубе”, Ведомости, 2009 05 05. [Inozemtsev V., “Modernizatsya.ru: What is left on the pipe“, Vedomosti, 2009 05 05] – in Russian. 141

from 146.3 to 141.9 millions19. Also there is an acute problem of population aging, which already in the short term can lead to pension system crisis. • Corruption and poor quality of public administration. The extent of corruption in Russia is very well illustrated by the fact that this country’s corruption rankings, annually published by Transparency Interna- tional, are in pair with African countries. National Anti-Corruption Committee (NGOs engaged in the fight against corruption) research shows that the annual turnover of “corruption market” is between 240 and 300 billion U.S. dollars, which represents more than 25 percent of country’s GDP (for comparison – the same turnover in China is around 80 billion U.S. dollars)20. Inefficiencies of public administration were still further accentuated by the economic crisis, when quick decisions were taken only in the cases, when it was necessary for oligarchic business structures or public corporations. At the same time, the Government has responded very slowly to the crisis in the “real sector” and the majority of anti-crisis measures were inefficient because of poor control of use of funds21. Russian authorities are aware of these root problems. During economic crisis country’s economic modernization was named a key priority. For example, in November 2009, in his annual address for the Federal Assembly, president Medvedev declared that one of the major goals of Russia’s relations with foreign countries is the modernization of the Russian economy. Therefore, foreign policy must be the very pragmatic and the basic criteria of its success - whether this policy improves living standards in Russia. Russian leaders declare that successful modernization will help to create many highly competitive sectors in the (not just raw materials) economy, based on innovations. This would substantially increase Russia’s capacity to influence global economic processes. However, it is very doubtful that Russia’s leaders will be able to successfully implement their modernization plan. Any serious modernization measures will encounter fierce resistance from the interest groups in the ruling elite. On the other hand, modernization is promoted by the fear of Russia’s leaders that otherwise the country’s economy will collapse. In that case they

19 Федеральная служба государственной статистики, Численность населения, http://www.gks.ru/ free_doc/new_site/population/demo/demo11.htm [The Federal State Statistics Service of the Russian Fed- eration, Size of the population] – in Russian. �� Grani. ru, Объем коррупции в России достиг четверти ВВП, 2009 03 17, http://www.grani.ru/Politics/ Russia/m.148724.html [Grani.ru, Share of corruption turnover in Russia reached quarter of GDP, 2009 03 17] – in Russian. 21 High levels of corruption and general inefficiency of public administration implies that despite the low energy and labor prices in Russia to build a kilowatt of electrical power costs 40 percent more than in Ger- many; to build a square. meter of commercial storage facilities in Moscow - 3 to 3.5 times more expensive than in Paris or Rome, and one kilometer of motorway construction is 3-4 times more expensive in Russia than average in EU countries. 142

will lose the power. Thus one can expect that the worse will be the country’s economic situation (for example, number of technogenic catastrophes will increase etc.), the stronger motivation Russian leaders will have to actually carry out the country’s economic modernization. So, to sum up the possibility for Russia to become a major player in the global economy could be assessed ambiguously: On the one hand, by the nominal size of GDP this country is among the seven largest world economies. In addition, growing global concerns about the potential shortages of energy resources, raw materials and food, are of heightened importance to Russia as the country has plenty of such resources. On the other hand, Russia’s economy is hard hit by the global financial crisis and rapid recovery could be expected in case if export commodity prices in the world market will reach record heights of 2007-2008. However, if Russia will not succeed in solving its deep economic problems, it may be necessary for the Kremlin to take care not to how to on how to avoid domestic economic disaster instead of achievement of its ambitious global goals22.

2. Russia’s Foreign Economic Policy during the Global Financial Crisis

2.1. Russian Efforts to use its Foreign Currency Reserves to Increase Influence on the International Economic System

As already mentioned, the Russian economic situation at the beginning of the global financial crisis was very good. Its public foreign debt was minimal, and Kremlin had third world’s largest foreign exchange reserves on its disposal (in August 2008 their amount reached 600 billion U.S. dollars, until the end of February 2010 they had shrunk to 439 billion U.S. dollars23). During the crisis, when many countries suffer from the debt burden, Mos- cow was trying to use its foreign exchange reserves to increase its influence. Prior to the analysis of how Moscow seeks to use its currency reserves, it is necessary to discuss the ambiguous situation with accumulation of foreign exchange reserves in Russia. A significant part of the Russian foreign reserves consists of sovereign funds. Since 2004, Russian leadership has decided to accumulate large share of the revenues generated by the oil exports into a so-called stabilization fund. In 2008 the fund was divided into two new funds – the Reserve fund (it is intended

22 This position is shared by U.S. Vice President Joe Biden, predicted in summer 2009 that the economic and social problems will force Russia to once again improve its relations with the West. See.: Spiegel P., “Biden Says Russia Will Bend Weakened the U.S.”, Wall Street Journal, 2009 07 25, 23 Банк России, Международные резервы Российской Федерации, http://www.cbr.ru/hd_base/mrrf/?C_ mes=01&C_year=2010&To_mes=03&To_year=2010&x=29&y=11&mode= [The Bank of Russia, Foreign exchange reserves of Russian Federation] – in Russian. 143 to cover the budget deficit during the periods of crisis) and the National Wealth Fund (the money from this fund could be used to cover pension system deficits and other purposes). In December 2009 the size of the Reserve fund was 75 billion U.S. dollars and of the National wealth fund - 93 billion U.S. dollars24. The money of the sovereign funds are invested into the safe financial instruments abroad. It should be noted that the accumulation of such sovereign funds is promoted and implemented by the neo-liberals in Russia’s government (Minister of finance A. Kudrin, Central Bank Chairman S. Ignatiev, and others). For the creation of these funds the following arguments were used: • To combat inflation, it is necessary to restrict the supply of money in the economy, so the sterilization (investment abroad) of the “excessive revenues” is needed25. • The fund accumulated reserves “for a rainy day”, for a situation when the prices of oil on the world markets fall sharply. It should be noted that this logic worked well in 2008-2009, when the money from sovereign funds were used to stabilize a situation in the Russia’s financial system. • The funds were invested abroad for several reasons: First, Russia’s financial system was underdeveloped, and therefore, it could not offer a reliable and efficient financial instrument for such big investments. Second, investment of sovereign funds abroad is a global practice: for example, Singapore, Norway, China, and Japan behave in the same way. Thirdly, in such way funds are protected from misuse. It should be noted that the fact that such funds were created and significant amounts of reserves accumulated is an evidence of a huge influence of neo-liberals on the country’s economic policies. At the same time Russian economist S. Glaziev identifies the main discrepancy of such policy. Although the Kremlin often declares the confron- tational stance towards the West, at the same time the Russian state’s funds are invested in the economies of the Western countries. This comes at a time when the Russian economy persistently lacks investments. Russian companies and banks are forced to borrow abroad and to pay much higher interest rates than the Russian state receives from its investments abroad26. It is interesting to note the fact that the total foreign debt Russian companies and banks never exceeded the total amount of Russian foreign reserves. Therefore, people in

�� Министерство финансов Российской Федерации, Совокупный объем средств Фонда национального благосостояния, http://www1.minfin.ru/ru/nationalwealthfund/statistics/volume/index.php?id4=6412 . [The Ministry of finance of the Russian Federation, The National wealth fund] – in Russian. From June 2010 information about size of both funds is classified. 25 It should be noted, that despite these measures the government failed to contain inflation, because the main reason of inflation in Russia is not the excessive money supply, but the dominance of monopolies in the economy. �� Эхо Москвы, Интервью С.Глазьева, 2008 10 16, http://www.echo.msk.ru/programs/razvorot/547077- echo/ [Radio station “Echo Moskvy”, Interview of S.Glaziev, 2008 10 16] – in Russian. 144

charge of Russia’s economic policy are often accused of conducting pro-western (especially pro-U.S.) policy. However, during the global economic crisis it has become clear that Russia may use its financial reserves, not only for economic, but also for political goals: In this area, duality of Russia’s foreign economic policy should be clearly identified: From the very beginning of the crisis, Moscow declared that it will do everything possible to ensure global financial stability. One of the measures to achieve this goal was responsible investment of its foreign reserves. A good example of this policy was Russia’s decision to support U.S. federal mortgage agencies, which have become one of the first victims of the global financial crisis. The first indicators of the extensive problem in the U.S. mortgage market were visible in the middle of 2006. In 2007 a large-scale crisis in this sector had began. However, Russia continued to actively increase its lending volume to U.S. mortgage agencies, which were particularly hardly hit by the crisis. Moscow did not stop, even with the fact that in fall of 2007 the share prices of these agencies fell by more than one third. The total Russian foreign reserves and fund investments in U.S. government mortgage agencies Fannie Mae and Freddie Mac bonds at the end of 2007 reached more than 100 billion U.S. dollars. In January 2008 Russian Ministry of Finance issued a decree, which once again included bonds of these agencies to the list of high priority investment instruments for a Russian foreign reserve funds27. These investments were only suspended in the spring 2008, when both agencies found itself on the verge of the bankruptcy. During 2008, the amount of Russia’s foreign reserves invested in U.S. government mortgage companies Freddie Mac and Fannie Mae decreased 25-fold (from 103 to 4 billion. U.S. dollars)28. It should be noted that substantial amounts of funds from mortgage agencies bonds were invested into U.S. Treasury bonds. During 2008, investments into U.S. Treasury bonds increased 3.5 times. Thus, Russia’s reserves are still invested in the U.S. economy and the dollar zone. In the fall of 2009 about 30 percent of Russian foreign reserves were invested into U.S. treasury bonds. Russia holds seventh place by the size of such investments. In September 2009 Russia had acquired these bonds for the total amount of 121 billion. U.S. dollars, which represents 4.26 percent of released in the U.S. treasury bonds (this list is headed by the China - 799 billion U.S. dollars (23 percent.))29. Such Russian behaviour can be interpreted by the following pragmatic reasons:

27 “ЦБ и Минфин заработали на американской ипотеке”, РБК-Daily, 2008 08 21, http://www.rbc- daily.ru/2008/08/21/finance/371867 [The Central bank and Ministry of finance made profit on the American mortgages, RBC-Daily, 2008 08 21] – in Russian. 28 Ibid. �� U.S. Treasury department, Major foreign holders of Treasury securities, http://www.treas.gov/tic/mfh. txt, 2010 07 13. 145

• Russia’s Central Bank officials state that investment in the U.S. mortgage agencies bonds were profitable and were made because these securities had the highest ratings. In addition, these financial instruments due to their high reliability were acquired by many other countries. • Russia increased its prestige, by showing itself as a responsible player, actively engaged in ensuring the stability of the international economy. • The bankruptcy of the U.S. mortgage agencies could hardly hit the international economy and that would be useless for Russia itself. In addition, this could lead to depreciation of Russia’s foreign reserves. • It is possible that there was an informal agreement between Washington and Moscow on this issue. At the same time Russian investments could be seen as a tool to influence U.S. policy. The United States suffers from its huge public debt and is dependent on the possibilities to successfully sell its Treasury bonds. Therefore, the threat to withdraw the funds from U.S. Treasury bonds may be an effective way to make pressure on Washington. In 2008-2009 Russia had tried to use this as a weapon. The former U.S. Treasury Secretary Henry Paulson said in his book of memoirs that in 2008 August, Russia has tried to persuade China to jointly sell U.S. mortgage agency bonds, thus creating serious difficulties for the U.S. economy30. Such actions included intimidations by the Russian officials to change Russia’s foreign exchange reserves investment instruments. For example, the Russian Central Bank Deputy Head A. Uliukaev, in June 2009, said that Russia plans to transfer some funds invested in U.S. treasury bonds to other investment instruments, in particular, the IMF bonds. The Minister of Finance A. Kudrin announced that Russia plans to buy IMF bonds for 10 billion U.S. dollars. The news about Russia’s plans to reduce lending to the U.S. government led to a significant extent, but the short-term depreciation of U.S. dollar against other major currencies31. However it should be noted, that Moscow’s possibilities to press the United States using its investments in Treasury bonds are very limited, because Russia’s share in the U.S. Treasury bonds, in contrast to China, which quite successfully uses this as a pressure, is insignificant. On the other hand, the Kremlin’s possibilities to use its foreign reserves as the tool of influence were increased by the fact that Russia’s state had no need to borrow abroad. However, it is now clear that the depletion of government financial reserves will change Russia’s position from the lender to the debtor. In 2009 it was announced that the Russian state is planning to resume borrowing in foreign markets. It will start after a long break (the last time Russia

30 Bloomberg, Paulson Says Russia Urged China to Dump Fannie, Freddie Bonds, 2010 01 29. 31 Bloomberg, Russia May Swap Some U.S. Treasuries for IMF Debt, 2009 06 10. 146

borrowed abroad before the economic crisis of August 1998). In 2010 Ministry of finance plans to sell euro-bonds for 17.8 billion. U.S. dollars and borrow 2-4 billion U.S. dollars from the World Bank32. In total over the next three years, Russia plans to borrow abroad more than 60 billion U.S. dollars.

2.2. Russia Aims to Influence the Transformation of the Global Financial System

Since the beginning of global financial crisis, Russia is actively advocating for the need to reform the current global financial order because it has major structural deficiencies. In January 2009 in the Davos World Economic Forum Russian Prime Minister V. Putin said that the current global economic system crashed and its reformation is inevitable33. Russia’s proposals on reforming the international economic system have been made public before the London G-20 Summit in March 2009 (before it was possible to record only the individual submissions of the Russian leadership on this issue). Among the major proposals can be distinguished: • Strengthening of the international financial markets regulation. • The need to develop and adopt an internationally agreed upon standard in the field of macroeconomic and budgetary policies, which would be mandatory for leading global economies, including countries issuing reserve currencies. • Enlargement (diversification) of the list of currencies used as reserve ones. • Introduction of a supra-national reserve currency to be issued by international financial institutions. This currency could be created on the basis of IMF SDRs. • Promotion of the development of major regional financial centres, existence of which could reduce volatility of global financial system. • IMF should be reformed and its competences expanded. In order to overcome the current crisis, resources of this organization should be significantly increased34. It should be noted that for a long time Russia has been advocating the reforms of the IMF, which would significantly increase quotas of the emerging economic powers. In Moscow’s

32 Пресс-служба Минфина России, Интервью Д.В. Панкина инфомационному агентству “Рейтер”, http://www.minfin.ru/ru/press/speech/index.php?id4=7910 [Press Service of the Russian Ministry of Finance, Interview of Pankin D.V. to the news agency Reuters] – in Russian. �� РИА НОВОСТИ, Доклад Владимира Путина в Давосе. Полная версия, 2009 01 29, http://www.rian. ru/economy/20090129/160410501.html [RIA Novosti, The speech of Vladimir Putin in Davo. Full version, 2009 01 29] – in Russian. �� Администрация Президента Российской Федерации, Предложения Российской Федерации к саммиту “Группы двадцати” в Лондоне (апрель 2009 года), 2009 03 16, http://tours.kremlin.ru/text/ docs/2009/03/213992.shtml [The Office of the President of the Russian Federation, Proposals to the G20 Summit in London (April 2010), 2009 03 16] – in Russian. 147

opinion, the current management system of this organization does not reflect the changed world economic structure. In this context, Russia demonstrated itself as selfless campaigner against injustice, as the reform of the IMF itself should not significantly increase Russia’s influence over the organization’s decisions. It is clear that the aim of the majority of Russia’s proposals is the reduction of the influence of the United States and other Western countries on the international economy. Moscow blamed irresponsible U.S. and other Western economic policies for the crisis induction. Russian President D. Medvedev in his speech during St. Peters- burg Economic Forum in June 2009 stated that the unipolar world system and artificially maintained monopolies in the key sectors of the global economy are the fundamental cause of the crisis35. Russia perceives the United States as a country benefiting from the dollar as the world’s main reserve currency status. In Moscow’s opinion, the wellbeing of the United States to a large extent is based on the exploitation of other countries (including Russia). During the economic crisis Russia, like other countries, continues to suffer from irresponsible U.S. fiscal policies. It should be noted that Moscow’s bold proposals for introduction of new supranational reserve currency instead of the U.S. dollar did not achieve the approval of the other G-20 members. In principle, such types of proposals were not even seriously discussed during the G-20 meetings. World leaders and the media pay much more attention to China’s proposals in this field. Russia is generally not regarded as an authoritative state, which can have a significant impact on the international economic system reform process. In Moscow’s view, this is because the U.S. and the West are in general against the substantial changes of existing status quo in the global financial system. Necessary reforms would destroy the Western monopoly on the most important decisions related to the management of international economic system. In order to strengthen its influence in the process of international financial system reformation Russia is seeking new allies. In June 2009 the first official meeting of non-formal club of emerging economies BRIC (Brazil, Russia, India and China), initiated by Russia, was held. It is obvious that after a failure to gain a sizable impact on the G-8 or G-20 level, Moscow aims to consolidate the BRIC countries in opposing U.S. hegemony in the global economic system. It is clear that Russia sees itself as a leader of such a consolidated fight. However, the results of the meeting showed that the other BRIC countries have not tended to support the aspirations of Russia. On one hand, at the meeting, the representatives of BRIC countries stressed necessity for the formation of a better functioning and more diversified glo-

�� Петербургский международный экономический форум, Стенографический отчет, 2009 06 05, http:// www.forumspb.com/upfile/file2/june_5_plenary_rus.pdf [St. Petersburg International Economic Forum, Stenographic report, 2009 06 25] – in Russian. 148

bal financial system. On the other hand, the BRIC states did not support Russia’s bid to create a supranational international reserve currency as a counterweight to the U.S. dollar. At the meeting Russia also proposed an agreement between the BRIC countries to move towards a broader use of national currencies of each others. However, it was agreed that the next meeting of BRIC will discuss possible guidelines for reforming the IMF, so that this organization to better reflect changes in the structure of the international economy (in particular, the increased economic weight of the BRIC countries). In addition, President Medvedev’s economic adviser Arkady Dvorko- vitch in June 2009 said that Russia is considering the possibility of transferring part of their reserves from a dollar denominated securities to the government bonds of the BRIC countries. Admittedly, this could happen only if the BRIC would invest their money into the Russian government bonds. To sum it up, Russian attempts to influence the global financial systems transformation process as of this moment are fruitless. While Moscow’s proposals in many aspects is similar to some other countries (notably the BRIC states) interests, Russia clearly does not have sufficient economic weight and credibility to make its voice heard and seriously taken into account.

2.3. Attempts to Create International Financial Center in Russia

According to Russian leaders this country will become one of the new poles of economic power in the new world economic order, which will appear after the end of global financial crisis. For that purpose Russia tries to become an international financial centre. In May 2008, the Russian Ministry of Economic Development announced an international financial centre in Russia as part of the development program. In summer 2009, the Government approved the plan for basic steps to develop an international financial system. In December 2009 a new concept for the creation of an international financial centre in Russia was made public. This document states that if the Russian government’s actions in this field are successful then the following main objectives will be achieved: • The ruble will become one of the international reserve currencies (in conjunction with the U.S. dollar, euro, etc.). • A ruble will be used in a considerable share of Russian foreign trade operations. • Russia’s stock markets will become one of world’s most important trading places for securities, raw materials and other items.36 However, success of these ambitious Moscow goals appear to be quite questionable:

�� Министерство экономического развития Российской Федерации, Концепция создания международного финансового центра в Российской Федерации. Проект, 2009 12 30, http://www.economy.gov.ru/minec/ activity/sections/finances/creation/conceptmfc [The ministry of economic development of Russian Federation, The Concept of creation of international financial center in Russia, The project,2009 12 30] – in Russian. 149

First, Russia is not very successful in creation of business climate, characterized by low levels of corruption, property rights protection, transparency and other properties attractive to foreign investors. It is clear that events such as the Yukos case, Shell and Gazprom conflict on Sakhalin-2 Project, does not improve Russia’s attractiveness in the eyes of investors. Secondly, an international financial centre must be based a well developed economy, based on the strong economic performance. As already mentioned, the Russian economy is hardly hit by the economic crisis and its future prospects are uncertain. Despite that, the Kremlin is taking active steps in order to achieve this ambitious goal. The biggest activity could be seen in the field of the introduction of a broader use of the ruble in the foreign trade operations. The Russian ruble is now a peripheral currency, which is used in only 0.16 percent of world transactions turnover. Most of the Russia’s foreign trade is also nominated in U.S. dollars and Euros. Broader use of the ruble would allow them to achieve several goals. Fore- ign banks and the companies would be forced to accumulate ruble reserves, as they would be required for foreign trade operations with Russia. In addition, it would reduce the dependence on the U.S. dollar and the euro, and accordingly on the economic policy of the Western countries. Already in 2006, Vladimir Putin called Russian companies to sell oil and gas to foreign markets in rubles. In November 2008 in its first Address to Federal Assembly president Medvedev said that a broader use of ruble in foreign trade is a priority goal of the Russia’s foreign economic policy37. In 2008–2010 this measures were taken to introduce broader usage of the ruble: • Russia offers to foreign countries to sign international agreements, which would allow broader use of ruble in bilateral trade. Most foreign partners met such proposals with scepticism. Better results in the expansion of ruble have been achieved only in CIS area. In 2009, trade operations in rubles represented more than half of the whole commercial transactions turnover between Russia, Kazakhstan and Belarus (the U.S. dollar accounted for less than one-third)38. • In order to increase the importance of the ruble, Russia offers CIS countries loans in rubles. It should be noted that the CIS countries are sceptical about the possibility of obtaining credits from Russia in rubles instead of Euros or U.S. dollars. • In order to carry out trade of petroleum, grain, fertilizers, sugar and other raw materials in rubles in 2008 St. Petersburg Stock Exchange

37 Послание Федеральному Собранию Российской Федерации, 2008 11 05, http://www.kremlin.ru/ appears/2008/11/05/1349_type63372type63374type63381type82634_208749.shtml [Address to Federal Assembly of the Russian Federation, 2008 11 05] – in Russian. 38 Голос России, Сергей Глазьев: Ни один из участников Таможенного союза не может вести переговоры отдельно, 2009 12 02, http://rus.ruvr.ru/2009/12/02/2480068.html [Voice of Russia, Glaziev S., None of the participants of the Customs Union can not negotiate separately, 2009 12 02] – in Russian. 150

was opened (the opening process for various reasons, lasted more than three years). In 2009 possibility to trade its oil in this stock exchange was offered to Iran. Tehran despite its declarations about intentions to abandon U.S. dollar in its oil export operations, met Russian proposal with caution39. • In September 2008, in St. Petersburg, was opened another - the natural gas exchange, where natural gas is sold for rubles. It is planned that after the completion of “Nord Stream” pipeline the customers from Western Europe will be able to buy at this exchange a large part of the necessary quantities of gas, which will be then supplied through this pipeline. However, in this case, the main reasons for opening stocks are Gazprom’s aims to sell natural gas to consumers within Russia for the highest possible price40. Despite the declarations, the Russian government is quite unsuccessful in its aims to increase ruble usage in the foreign trade. This happens due the following fundamental reasons: Firstly, the attractiveness of ruble is reduced by the instability of the exchange rate of this currency. In addition, companies and investors cannot rely on the Russian government officials’ declarations about ruble exchange rate. For example in autumn – winter of 2008, Russian leaders reiterated that the ruble will not depreciate. Those declarations kept coming even when deep ruble devaluation began. Secondly, Russian businesses, are not interested in the usage of ruble in its commercial operations. So far, the Russian leadership cannot force even public companies sell exported oil and natural gas for rubles. The reason is that even if in trade operations rubles will be used, oil prices are still tied to the U.S. dollar, whereas the ruble does not have any significant positions in the global financial system. Since the ruble exchange rate to U.S. dollar is not stable Russian oil customers will pay lower prices for Russian exporters in order to hedge against currency risk. Gazprom is not interested to switch to rubles because in this case the company would be forced to revise its long-term contracts with European customers and possibly provide additional advantages for them. Thirdly, in switch to rubles are not interested foreign customers of foreign buyers of Russian raw materials. Fourth, the majority of Russian oil is not sold directly to its customers, but instead to companies-mediators. It is likely that in many cases, these agents are so closely linked with the top management of energy companies and the

�� Зыков С., “Нефть в обмен на рубли: Ирану предложено торговать “черным золотом” на Петербургской бирже”, Российская газета, 2009 03 04. [Zykov S., Oil in exchange for rubles: Iran got the proposal to trade it “black gold” on the St. Petersburg exchange”, 2009 03 04] – in Russian. �� Fintimes.ru, Превратить постсоветское пространство в рублевое!, 2009 06 03, http://fintimes. km.ru/aktualnye-temy/7672 [Fintimes.ru, To turn post-soviet space in the ruble space!, 2009 06 03] – in Russian. 151 members of the Russian ruling elite. Foreign trade operations are often used as a tool for “capital flight” from Russia or the part of corruption “schemes”41. It is obvious that switching to rubles could create additional obstacles for such operations. In conclusion, although Moscow has managed to expand the ruble use in the CIS, success prospects for creation of an international financial centre still seem pretty vague. This goal could be achieved only with substantial improvements in the investment climate in the country, ensuring a successful long term economic development and breaking exporting companies opposition.

2.4. Promotion of Economic Integration between CIS Countries

During the economic crisis, Russia has stepped up its activities in promotion of the economic integration project in CIS. It is obvious that if the successful and effective economic integration project would be created, Russia naturally becomes its leader. That success would naturally strengthen Moscow’s position as a global economic power centre. The economic crisis has increased the opportunities for Russia to influence its neighbours in the CIS space. Russia, although faced with serious economic problems, is in much better economic shape than many other countries in this zone (except for Azerbaijan and Kazakhstan). At a time when most states of the CIS suffer from foreign debt burden, Russia has accumulated significant foreign exchange reserves. In addition, the economic crisis in Russia adversely affected by its neighbours in the CIS. A result of increased protectionism and reduction of demand is the reduced opportunities to export their products to Russia. Another pressing problem was the deterioration of the situation of labour migrants in Russia. Problems in the construction sector and rising unemployment among Russian citizens negatively affected incomes of labour migrant. This causes a negative impact on some CIS countries. For example, the World Bank estimates that the labour migrant remittances in 2007 accounted for 36 percent of Tajikistan and Moldova’s GDP, 27 percent of Kyrgyzstan GDP (estimates of local experts are even higher)42. Thus, the global financial crisis has increased the interest of some CIS countries to take a more active part in integration projects promoted by Rus- sia. In June 2009 Russia, Belarus and Kazakhstan signed an agreement, which created a Custom Union between these countries. The decision to establish a cus-

41 Harding L., “Russian billionaire drops libel case against Economist”, The Guardian. 2009 07 30. �� Deutsche Welle, ВВП Таджикистана держится на плечах трудовых мигрантов - пора создавать миграционное министерство, 2008 03 24. [Deutsche Welle, GDP of Tajikistan rests on the heels of labor migrants – it is time to create ministry of migration, 2008 03 24] – in Russian. 152

toms union was finally established in December 2009 at the three heads of state meeting in Almaty43. The Custom Union was originally planned to enter into force from 1 July 2010 (between Russia and Belarus, between all three countries – from 1 July 2011). However, from the beginning of creation of these base principles of the Customs Union’s operation, it became clear that the success of this integration project is not guaranteed and the union certainly will begin to function later than planned. Member States are not always able to effectively deal with conflicts arising from the future functioning of customs union. Russia has not yet been fully determined what the additional financial costs it is willing to bear in the name of the Customs union. According to experts, Russia’s annual loses of involvement in the project may reach 16 billion U.S. dollars44. The biggest problems arise between Russia and Belarus. Both countries until summer 2010 didn’t manage to reach an agreement on how Russian duties on raw oil export to Belarus will be calculated after the introduction of the Customs Union. If an agreement will not be reached, the Customs Union will be limited only to Russia and Kazakhstan (Russia and Kazakhstan have some problems too – transit of the Kazakhstan energy resources through the territory of Russia, Chinese goods for re-export from Kazakhstan to Russia, etc). On the other hand, the success of the Customs Union will make it possible to create even deeper regional economic and political integration projects, and perhaps even the “new Soviet Union” project. Such an economic block of countries will have a greater weight in the global economic systems than the Russia alone. Especially if Russia’s economic potential will be complemented the relatively developed industry in Belarus and Kazakhstan’s natural resources. Russia is actively developing other integration projects in the CIS. For example Eurasian, at the meeting of member countries of Eurasian Economic Community (EurAsEC) in February 2009, it was agreed to create a joint anti-crisis fund. From this fund immediate relief credits will be provided the member - states of the organization, faced with financial difficulties. So actually this fund is the regional counterpart of the IMF. It is clear that assistance from this fund would be more attractive to countries than credits from IMF or World Bank because of not so strict conditionality. The total size of the fund - 10 billion U.S. dollars. Of these 7.5 billion. will contributed by Russia, 1 billion. U.S. dollars – by Kazakhstan, 10 million U.S. dollars – by Belarus. Kyrgyzstan and Tajikistan will provide 1 million. U.S. dollars each.

43 Совместное заявление президентов Республики Беларусь, Республики Казахстан и Российской Федерации, Алматы, 2009 12 19, http://www.tsouz.ru/news/Documents/presidents_zayava.aspx. [Joint Statement by the Presidents of the Republic of Belarus, Republic of Kazakhstan and the Russian Federation, Almaty, 2009 12 19] – in Russian. �� Радио Свобода, Единое конфликтное пространство, 2010 01 06, http://www.svobodanews.ru/content/ article/1922649.html [Radio Free Europe, Common conflict zone, 2010 01 06] – in Russian. 153

However, although an international agreement on the creation of anti- crisis fund the establishment was signed in the summer of 2009, the fund operations didn’t get started till the summer of 2010 and its future is uncertain. The economic crisis has increased opportunities for Russia to use credits to foreign countries as a tool of influence. In other words Russia often provides loans in exchange for a “friendly policy” and “right decisions”. For example, in January of 2009 Russia lent to Kyrgyzstan 2 billion. U.S. dollars in exchange for an informal promise to remove U.S. airbase in Manas. Lending to Belarus has been associated with the informal promise to recognize independence of Abkhazia and South Ossetia. In 2009 Russia lent 500 million U.S. dollars to Armenia. At the same time Moscow “teaches” unfriendly countries by refusing to give them credits. For example, Russia refused to give credit to Ukraine in 2009, when president of Ukraine Viktor Yuschenko often used sharp rhetoric when speaking about bilateral relations. On the other hand in 2010, when Viktor Yanukovich became a president of Ukraine, Russia gladly lent 4 billion U.S. dollars to Kiev. Summing it up, although Russia managed to achieve a good track record in developing economic integration projects in CIS, the future prospects of this process is not clear. It will largely depend on Russia’s own economic situation and political will to share resources with its neighbours in the name of integration. Especially since 2007-2009, Moscow feels growing competition for influence in CIS from China. This country has far greater financial resources than Russia (in summer 2009 Chinese international reserves exceeded 2 trillion. U.S. dollars) and this country is actively seeking new opportunities to invest abroad45. In addition to the traditional Chinese business interests in the Central Asia, it began to develop closer relations with countries such as Belarus and Moldova46.

2.5. Increase of the Protectionism Level in Foreign Trade

Before the crisis, one of the most neo-liberal aspects of Russia’s foreign economic policy was the foreign trade regulation. Since 2000 this policy sector was dominated by the desire to join the World Trade Organization, resulting in a constant reduction of import duties and liberalization of foreign trade regulations in general.

45 Bloomberg news, China’s Foreign-Exchange Reserves Surge, Exceeding $2 Trillion, 2009 07 15. �� In March 2009 it was announced that Belarus and China agreed to swop national currency reserves. They gave each other the Belarusian ruble and the Chinese yuan respectively for the the total equivalent of 3 billion U.S. dollars. These funds will be included in the foreign exchange reserves and in the future will used in the bilateral trade instead of U.S. dollars or Euros. In summer 2009 it was announced that China will provide preferential 1 billion. U.S. dollar loan for Moldova for 15 years, which will be used for infrastructure projects (Chinese companies will take active part in these projects). Infotag, Кредит в $1млрд от Китая, 2009 07 23, http://www.azi.md/ru/story/4643 [Infotag, Credit in 1 billion U.S. dollars from China, 2009 07 23]. 154

The situation has changed substantially after the beginning of the economic crisis. From 1 January 2009 import duties on the second-hand cars were significantly increased. In 2009 there were increased customs duties and non- tariff restrictions on certain food products and other goods. A serious drop of the industrial production volume made customs duties and other protection measures of domestic market to seem to be the most reliable option to protect local producers. Protectionism in this case is seen as a tool for economic modernization and diversification (in this case, protecting the weak growth of local manufacturers from much stronger foreign competitors). In addition, the revenues from higher custom tariffs could be used to lower budget deficit. However, the clearest signal that neo-liberal in Russian foreign economic policy is getting weaker was a decision to join the WTO together with the Customs Union partners - Belarus and Kazakhstan. This was announced in June 200947. In order to understand the reasons for Moscow’s decision, it is worth discussing Russia’s accession to the WTO process. Russia began its accession to this organization in 1993. By the middle of 2009 these negotiations were almost completed. The main reasons for Russia to become WTO member were the following: • Aim to increase its influence in international economic governance process. Russia currently is the largest state, which is not a WTO member. Therefore, Russia cannot participate in the process of an international trade system reformation. • Improvement of access to the export markets. Direct benefits of accession to the WTO to the Russia’s exports are minimal. WTO rules do not regulate the bulk of Russian exports. Neither the raw materials, nor the weapons, fall into the jurisdiction of the WTO. The real positive effect on the Russian exports, at the best, may reach 5-7 billions U.S. dollars (up to 2 percent of the total Russian export volume). At the same time, accession to the WTO would make a negative impact on many Russian industries, which will face increased competition in the domestic market. • However, if Russia will successfully diversify its economy and become a producer of competitive production with high value added, WTO membership may become necessary. • Accession to the WTO as the catalyst for liberal reforms within Russia. Russian leadership, especially proponents of liberalism see accession process as an opportunity to liberalize Russia’s economic and legal systems. Thus accession to the WTO would carry out a similar role as that of the EU accession of Central and Eastern European countries. Such economic liberalization “from the top” could stimulate successful

47 RIA Novosti, Russia, Belarus, Kazakhstan seek to join WTO as customs bloc, 2009 06 09. 155

development of Russian economy. For example, the head of public corporation “Rosnano” A. Chubais expresses the opinion that the WTO accession would add 1-2 percent of GDP growth annually48. It is clear that the accession to the WTO was project of a neo-liberal part of the Russian ruling elite, which relied on the fact that Russia’s success in the international economy will be achieved under the general rules of play. The decision to join together with Belarus and Kazakhstan, in fact, means that Russia at least in the short term, refuses to access to the WTO. While the WTO rules do not prohibit this organization to be joined in groups of countries, but such a case would be the first in the history. Accession of such different countries with diversify the foreign trade structure and the different domestic economic regulation would require not only very complex negotiations with existing WTO members, but also a number of coordination between “joining partners”. Summing it up, the Russian decision to delay accession to WTO could be explained by: • First, accession to WTO could potentially be an obstacle to the creation of the Customs Union (for example, Russia would be member of WTO, Belarus – not a member of this organization). • Secondly, freezing the WTO expands the level of freedom in implementation of protectionist measures and increases the overall independence of Russia’s economic policy. • Thirdly, a reformation process of international trade within the framework of the WTO is halted due to conflicts between member-states. It is likely that Moscow no longer thinks that the WTO membership could significantly increase its influence on the development of agenda for reformation of global economy. On the other hand such Kremlin decision could be explained as a tactical move, which aim is to strengthen its negotation position in the WTO accession proccess. This version is supported by the Russia’s leaders declarations at the end of 2009 - beginning of 2010, that Moscow is still planing to join WTO as soon as possible. This will show real Moscow’s priorities: what is more important - Cus- toms union or accesion to WTO?

48 Росбалт, Чубайс призвал защитить российского товаропотроизводителя перед ВТО, 2009 06 04. [Rosbalt, Chubais called upon to defend Russian producers in WTO accession process, 2009 06 04.] – in Russian. 156 Conclusions

The assessment of Russia’s foreign economic policy during the crisis shows that the Kremlin understands this downturn as an opportunity period. In Moscow’s opinion, the world economic system after the crisis will not be the same as before, therefore it is needed to secure an as influential as possible position in that coming new world economic order. The new system will be characterized, in its view, by the significant decrease of influence of the West, and the rise of influence of a new (including Russia) economic powers. Moscow aims to be one of the major players in the transformation process of global financial system. To create a base for such aspirations, Russia aims to build a strong economic power centre. For that purpose, Russia plans of deep economic modernization are declared. Another important component of this strategy are - aims to create an international financial centre in Russia. Finally, but not the last component of a strong power centre building are the – economic integration projects in CIS, which have got new stimulus during the economic crisis. However, although the majority of Russia’s actions in order to benefit from global economic crisis are targeted and have their own logic, this country is still unable to achieve any greater successes. Moscow’s proposals on the international financial system transformation are ignored by other major players; creation of international financial centre is much slower than Kremlin wants it to be, as does economic integration in CIS area. Clearly, the most important reasons for these failures are - Russia’s economic weakness. Global financial crisis clearly demonstrated the structural problems of this country economy and the Kremlin’s inability to effectively deal with them. Another reason for Russia’s failures is lack of political will to achieve positive changes in domestic and foreign economic policy. It is clear that if Russia will fail to resolve its deep economic problems, it may be necessary to take care not to how to achieve the ambitious global goals, but on how to avoid economic disaster at home. In such circumstances, a shift to a more pro-western and neo-liberal policy is possible.

January – June 2010 157

Laura Kirvelytė* General Jonas Žemaitis Military Academy of Lithuania

Moldova’s Security Strategy: the Problem of Permanent Neutrality

Just after declaring its independence in 1991, Moldova encountered several challenges to its national security, the most serious of which were the conflict with the breakaway Transnistria1 region and the deployment of Russia’s armed forces in the territory of Moldova. Under these circumstances Moldova chose permanent neutrality as a security strategy, ignoring the fact that country didn’t meet even minimal requirements for a neutral country. The strategy of neutrality, adopted preci- pitately, has not added to the minimization of threats to Moldova’s national security. Moreover, neutrality has been an obstacle for the state to choose a more suitable and well-balanced security strategy. In addition, declared permanent neutrality could even appear as an obstacle for Moldova in the way towards its strategic goal - EU membership. In this article the peculiarities of Moldova’s neutrality and the key problems of state’s security strategy are discussed. The factors of Moldova’s neutrality, looking from the perspectives of several different approaches of international relations, and Moldova’s security dilemmas after the Russian-Georgian war, are analyzed.

Introduction

Moldova – a small state in Eastern Europe2 sandwiched between Ukrai- ne and Romania – has attracted the attention of the international community in early April 2009, when, after falsified parliamentary elections, the massive protests against the falsified victory of the ruling Moldova’s Communist Party broke out. Dissatisfied citizens were demanding the organization of a new election. Nevertheless mass protests in Moldova hadn’t gained any “colour”, these events and processes can be taken as a starting point for a new stage in Moldova’s politics3. The problems of Moldova’s democratization were brought

* Laura Kirvelytė is a lecturer of the Command and Junior Staff Officer Courses of the Military Academy of Lithuania. Address: Šilo str. 5A, 10322 Vilnius, tel. (+370 5) 2103569, e-mail: [email protected]. 1 Also known as “Trans-Dniester” or “Transdniestria”. 2 Moldova‘s attribution to one or another region – the object of discussions. In the different sources, Mol- dova has been attributed to different regions: Eastern Europe, South-Eastern Europe, Black Sea Region or even the Balkans. 3 April 2009 events in Moldova are not referred as “revolution” because of several reasons. First of all, the shift of ruling elites took place purely in institutional way: early elections were organized not because of demand of citizens, but due to Constitutional mechanism (opposition parties two times successively refused to support communists‘ candidate to the post of the President of the Republic of Moldova). Second, the government, composed of pro-democratic political forces, still holds temporary character – communists used the same Constitutional mechanism of President’s election, in the consequence of what in Autumn 2010 the country would hold the second early parliamentary elections. 158

into the first plan by the April 2009 protest and the processes that followed, though the long-time ignored paradoxes of the state’s foreign and security policies were also remembered. The relevance of the topic of Moldova’s security is evident ipso facto Moldova is a small state, located in the area of intersection of the interest zones of the two great powers (in the academic literature this situation is called “the paradox of small state”). Nevertheless, until now the issue of Moldova’s security has been “forgotten” in domestic and foreign agendas, ignoring the fact that both the security situation of Moldova and its solution could be considered as a kind of exception in the post-Soviet sphere. First and foremost, Moldova has been seeking the resolution of a frozen conflict with breakaway Transnistria for almost two decades already. The Trans- nistrian conflict has not only been the main threat to Moldova’s national security, but also the main challenge to the country’s sustainable development. Second, the full decade has passed since the 1999 Organization’s for Security and Cooperation in Europe (OSCE) Istanbul summit, during which Russia took the obligation to withdraw its military forces from Georgia and Moldova in several years’ period. Russia has failed to fulfil its commitments regarding Moldova, and now Moscow doesn’t even consider the renewal of the withdrawal of it’s military forces from the territory of Moldova. In this context, Moldova’s security situation has been especially complicated by the undetermined presence of the foreign country’s military forces in its territory. Moreover, the Russian-Georgian war, which broke out in August 2008, sounded as if it was a warning for Moldova, informing the latter that it could become the next victim of Russia’s aggression. It is worth mentioning that Moldova, as Georgia, seeks to escape from the zone of Russia’s domination, and the seeking EU membership is country’s strategic goal (in Georgia’s case it was NATO membership). At the beginning of the 90’s young Moldova hoped that the principle of permanent neutrality, fixed in the Constitution and main strategic documents, will calm down both Russia and Transnistria and will help to minimize the threats to the state’s national security. Thus the hopes attached to the neutrality haven’t been realized – today Moldova encounters the same threats to its national security as two decades ago. Moreover, the neutrality strategy threatens to become a serious obstacle for the state to realize its strategic goals. The international practice shows that small states usually choose neutrality in order to balance between two confronting great powers. In addition, economic interests of the small state very often lay behind the neutrality strategy – the small state seeks to get economic benefits from the cooperation with both powers, so it is interested in eliminating security policy issues from the bilateral cooperation agenda. In this context it is worth mentioning that Moldova’s neutrality strategy from the very beginning has not been the strategy of “balancing”, but rather the strategy of “inaction”. The breakout of the critics towards Moldova’s security strategy in the state’s academic discourse could be observed in 2005, when EU membership 159 became the country’s strategic goal. Numerous publications in this field belong to Moldova’s think tanks - IDIS Viitorul, Association for Foreign Policy (Asociaţia pentru Politică Externă), Pro-Marshall Center of the Republic of Moldova (Centrul Pro Marshall din Republica Moldova), NATO Information and Documentation Center of the Republic of Moldova (Centrul informare şi documentare privind NATO din Moldova). Nevertheless, the efforts to reconsider options of security strategy in practice have still been vague. First, the tendency towards another extreme – alliance security strategy and NATO membership – could be observed in Moldova’s academic community. In this regard, the study of IDIS Viitorul experts “In NATO We Trust? Explaining Why Moldova Would Need to Join NATO” should be mentioned. Mo- reover, in the publications of Moldova’s security experts, attention is focused on the issue of the country’s partners in the international arena, but not on the wider issue of security strategy. In other words, they try to answer the question “With whom?”, but not “How?”. Moreover, the relationship between academic thought and political practice in Moldova has been weak, so positive developments in the field of the country’s security policy were hardly expected. The goal of the research presented in this article, is to answer the question, why Moldova chose permanent neutrality and what are the perspectives of this security strategy. In the first part of the article, the relation of Moldova’s geopolitical situation with the country’s security strategy is discussed. In the second part, based on the analysis of Moldova’s strategic documents, the development of Moldova’s security strategy is presented and the peculiarities of country’s neutrality are discussed. The third part of the article discusses why Moldova until now has upheld its paradox neutrality. Looking from the perspective of three approaches of international relations – realism, pluralism and constructivism, the origins of the demand for neutrality strategy, the emergence of its insufficiency in practice and the perspectives of Moldova’s security agenda are analyzed.

1. Moldova at the Geopolitical Crossroad

Moldova, which proclaimed it’s independence after the end of the Cold War, together with other post-communist states found itself in the so-called “grey zone”, described by the “vacuum of power” in relations to the great powers. Moldova, together with the other countries from the “grey zone”, fulfils the function of barrier in the geopolitical codes of the great powers (USA and Russia)4. Therefore, looking from the regional perspective, Moldova’s geopolitical function depends on the geopolitical function of Ukraine – geopolitical

4 Serebrian O., “Perspectivele geostrategice ale Republicii Moldova” [“Geostrategic Perspectives of the Re- public of Moldova”] in Studii internaţionale: Viziuni din Moldova. Publicaţie periodică ştinţifico-metodică, Nr. 3(4), 2007, p. 34 (in Romanian). 160

centre of Eastern Europe. For the Western powers (primarily – USA) Moldova plays the role of “jumping-off�� ground” ��for expanding and consolidating the influence in Ukraine. In other words, the existence of strong democratic Moldova would facilitate the democratization of Ukraine. At the same time, looking from Russia’s perspective, Moldova is a barrier, blocking Western influence for Ukraine – stable pro-Russian Moldova’s geopolitical orientation would assist Russia in “returning” Ukraine to its “sphere of influence”. On 27 August 1991, when declaring its independence, Moldova had not considered the option of remaining within Russia’s sphere of influence. Conversely, the goal of a young state was to return to the “historical truth” and restore close relations with Romania, or, even more, to form a common state. This would be the favourable scenario for the West, especially for the USA, because a shift of Moldova’s foreign policy priorities towards Romania would “divide” the post-soviet space, and would aggravate the restoration of Russia’s influence in the so-called “grey zone”. But Russia had not accepted the fact of a loss of influence to its former allies. After Moldova’s unsuccessful conflict with Transnistria, provoked by Russia, the latter has diverted Moldova’s geopolitical orientation vector from the West towards former Soviet Union space for a long time. Moldova maintained a “forced” pro-Russian geopolitical orientation for more than a decade. The shift of the geopolitical vector is reflected also in the domestic policy – from 1994 to 2009 parliamentary elections pro-Romanian political forces never held the majority in the country’s legislative5, and in 2001 the Communist Party with openly pro-Russian programme won the election6. In 2005 Moldova turned to the path of “balancing” between two major powers. Parliamentary election were again won by Communist Party, but this time – with more “pro-Western” programme, naming the EU membership as the strategic goal for Moldova. Nevertheless, in practice, a Communists’ EU policy was implemented in a quite formalistic manner7, at the same time geopolitical orientation vector fluctuated between Russia and the West. After the early parliamentary elections, which took place on 29 July 2009, four pro- European parties got the majority in country’s legislative (they have formed the alliance “For European Integration”), and Moldova firmly turned towards pro-Western orientation. At the global level, nevertheless Moldova still remains in “grey zone” between Russia and the West, the country already has institutionalized instruments of cooperation with the West: Moldova is included into the EU Eastern

5 Josanu Y., Juc V., Rusandu I., Sisteme politice tranzitorii din Europa de Sud-Est (studiu comparat) [“Po- litical Systems in Transition in South-Eastern Europe (Comparative Study)”], Chişinău, 2008, p. 77 (in Romanian). 6 Waters T., The “Moldovan Syndrome” and Re-Rusification of Moldova: Forward into the Past!”, G105, Conflict Studies Research Centre, February 2002, p. 3–4. 7 Molodilo D., “Republic of Moldova within the European Security System: Partners, Challenges, Perspec- tives” in European and NATO Neighbouring policies – new dimensions for regional cooperation, training seminar, Chisinau, Republic of Moldova, November 28–29, 2007, p. 87. 161

Partnership Initiative, in the nearest future the negotiations with the EU on the EU-Moldova Association agreement will start, Moldova cooperates with NATO under the Individual Partnership Action Plan. Regional context is also favourable for the strengthening of Moldova’s pro-Western orientation: Moldova expeditiously improves relations with EU and NATO member Romania, another neighbour of Moldova – Ukraine, is also aspiring for EU integration. Moldova’s participation in the Black Sea region cooperation formats also support the spread of democratic and pro-Western values and strengthens the aspirations of euro integration. Even in the post- soviet sphere Moldova belongs to the so-called pro-Western formation – the GUAM block, including Georgia, Ukraine, Azerbaijan and Moldova. In the local level Moldova encounters the greatest challenges and obstacles to the maintenance of its pro-Western orientation. Firstly, a frozen conflict with Transnistria is the main reason for the maintenance of Russia’s strong influence for Moldova. As it is mentioned by experts, after the “freezing” of the Transnistrian conflict Moldova became the state with two governments, two flags, and, what is worst of all, two armies8. Moreover, if the frozen Transnistrian conflict would pass to the “hot” stage, what happened to Georgia in 2008, the real threat to Moldova’s sovereignty, or at least for loosing “all the work it has done” in cooperation with the West, would arise. Second, the development of pro-Western Moldova’s orientation has been restrained by difficult country’s demographic situation. Moldova has been experiencing one of the greatest flows of the economic migration in the context of post-soviet space. According to the official data of research, carried out in 2004, about 600 thousand citizens out of Moldova’s labour force, or every third employable Moldovan, is working abroad9. According to experts, the real number of economic emigrants could be to two times higher. In this context, the critical pro-Western part of society is being “dissolved”, at the same time there are favourable conditions inside the country for the concentration of critical “volume” of citizens, who stand for the firm relations with Russia.

2. The Development of Moldova’s Security Strategy

A complicated security situation and Moldova’s difficult political and economic transition in the early 90’s prompted the country to choose neutrality as a compromise security strategy. Thus, the decision to adopt neutrality was

8 King Ch., The Moldovans. Romania, Russia and the Politics of Culture. Stanford University, 2000, p. 229. 9 Мошняга В., “Международная трудовая миграция молдавского населения и проблема денежных переводов в человеческом и институциональном измерении”[“International Labour Migration of the Moldova‘s Inhabitants and the Problem of Monetary Transactions from the Human and Institutional Per- spectives”] in Studii internaţionale:Viziuni din Moldova. Publicaţie periodică ştinţifico-metodică,Nr. 4(5), 2007, p. 23 (in Russian). 162

precipitous and un-weighted, misevaluating internal and external situation of the country. First and foremost, Moldova, from the very start, has not corres- ponded even minimal requirements for a neutral country. Moreover, Moldova’s neutrality has not been guaranteed by any other external power (country or international organization) and has not been recognized by the international community. The paradox is that now Moldova’s neutrality has become a kind of “axiom” of state’s security policy, the relevance and expedience of which does not appear under considerations in the political debates.

2.1. The Development of Security Policy in the Strategic Documents

The security strategy of a sovereign state – complex formation that describes the behaviour of the state, which seeks to guarantee its security, taking into account internal and external threats. So, security strategy involves both strategic documents and the country’s day-to-day political practice. It is important to mention that nevertheless, the country’s security policy directions are not always fixed in the strategic documents, the “documentation” of the state’s security policy is important for several reasons. Firstly, by involving the main principles of the state’s security policy in the strategic documents, the country informs other members of the international community about its intentions in the field of foreign and security policy. Secondly, strategic documents help to maintain the continuality of a state’s foreign and security policy, which is especially important during the change of ruling elites. Moldova, comparing to other post-communist states, formed the full hierarchy of its strategic documents quite early. The Concept of National Se- curity, which is being considered as a “core” strategic document, was adopted in 1995 (the new edition of this document was adopted by the Parliament in May 2008), Concept of Foreign Policy, which is still acting, was also adopted in 1995. That same year the Military Doctrine was approved. Although having a “classical” form, Moldova’s system of strategic documents lacks the accordance with actual geopolitical and security situation. The first document of independent Moldova - the Declaration of Inde- pendence, which was adopted on 27 August 1991, has no reference to the state’s neutrality. Moreover, the document emphasizes the importance for Moldova to become a part of the universal and specialized regional international organizations, stressing the importance of Moldova’s participation in the Conference for Security and Cooperation in Europe (the predecessor of contemporary OSCE) and active participation in its mechanisms10. The tone of Moldova’s Constitution, adopted in 1994, was completely different from the tone of the Declaration of Independence – 11th Article of the

10 Lege privind Declaraţia de Independenţă a Republicii Moldova [The Law on the Independence Declara- tion of the Republic of Moldova], Nr.691-XII din 27.08.91, Monitorul Oficial al R. Moldova nr.11–12/103 din 30.12.1991 (in Romanian). 163

Constitution foresees the permanent neutrality of Republic of Moldova11. The declaration of neutrality in the Constitution is a very strong assertion of security policy, from which it is difficult to step back both politically and technically. In addition, it is worth paying attention to the fact, that neutrality was declared by a young, newly-independent state, foreign and security policy directions of which yet had been only in the process of formation. The Concept of National Security of 1995, the main strategic document, repeated the constitutional provision of the permanent neutrality12 without further explanations. In this document, great attention was paid towards internal threats to Moldova’s security (attempt against country’s constitutional order, the provocation of social unrest, the reduction of country’s economic, technological and defensive capabilities and etc.). At the same time external threats are formulated in a quite abstract manner and seem to be automatically rewritten form the “sample” security documents. For example, the threat of terrorism, which was not so actual for the Moldova in mid-90’s, is described by a separate point in the document, at the same time the threat caused by the 14th Russian army, dislocated in Moldova’s territory after the unsuccessful conflict with Transnis- tria, was described by loose formulation “the threat of direct aggression against Moldova’s territory”, and the most actual threat for Moldova – separatism threat – is not even mentioned, replacing it with “the threat of conflicts in Moldova’s international environment”. The improvements of the Concept of National Security should have taken place in 1998, but because of the Russian crisis, which had especially grave consequences for the Moldova, dependent from Russia’s markets, this task was postponed13. At the end of 2005 the then president Vladimir Voronin ordered by the decree to form two commissions to improve the Concept of National Security and the Concept of Foreign Policy14. In May 2008 the Parliament approved a new edition of the Concept of National Security. In comparison with its predecessor, the new document is more concrete, putting emphasis on external more that internal threats, the first place in the list of threats belongs to the

11 Constituţia Republicii Moldova [The Constitution of the Republic of Moldova], http://www.presedinte. md/const.php?page=8100&lang=rom#8100 [2009-11-15] (in Romanian). 12 Hotarirea Parlamentului Republicii Moldova cu privire la aprobarea Concepţiei securităţii naţionale a Republicii Moldova şi la formarea Consiliului coordonator pentru elaborarea proiectelor de legi şi altor acte normative care vor reglementa construcţia, pregătirea şi folosirea Forţelor Armate [The Decision of the Parliament of the Republic of Moldova on the Formation of Coordination Council for the Preparation of the Projects of the Laws and Other Normative Acts, which will Regulate Formation, Training and Use of the Armed Forces], Nr.445-XIII din 05.05.95, Monitorul Oficial al R. Moldova nr.35/399 din 29.06.1995 (in Romanian). 13 Mînzărari D., Proiectul Concepţiei securităţii naţionale – test decisiv pentru elita politică moldovenească [The Project of the National Security Concept – Crucial Test for the Moldovan Political Elite], Discussion paper No. 1 August 2007, IDIS Viitorul, p. 14 (in Romanian). 14 Leşanu A., “Concepţia Securităţii naţionale: un document strategic pentru scopuri tactice” [“National Security Concept: the Strategic Document for Tactical Aims] in Political and Security Statewatch, Buletin analitic lunar de IDIS Viitorul, Mai 2008 Nr. 5 (12), p. 9 (in Romanian). 164

Transnistrian conflict and the threat to Moldova’s territorial integrity. Nevert- heless, the main shortcomings of the previous Concept of National Security were not corrected. Firstly, the new document was already criticized because of the form. The Concept of Moldova’s National Security foresees that, on the ground of this document, National Security Strategy will be prepared, which will foresee the ways for guaranteeing country’s security, mechanisms, the financing of security and defence sectors and the reformation of security sector15. It could be interesting why the document, adopted in May 2008, could not cover these aspects. As international practice shows, the guiding document in the security field could be formulated both as concept and as strategy. If the form of conception was considered to be inappropriate for settling of goals and means to maintain national security, it is still unclear, why Moldova’s Government, instead of preparing second Concept of National Security, had not followed with the preparation of National Security Strategy at this time. It is observed that post-soviet states tend to label the core document in the security sphere as the concept in order to “soften” the character of the document16. In the case of Moldova, even though during the discussion period it was proposed to formulate the document as strategy, not concept, but, most probably, seeing to avoid the Russia’s reaction, this proposal was not taken into consideration. Secondly, the Concept of National Security overtook the shortcomings of the content from its predecessor. The document overtakes, but doesn’t explain or develop, the principle of neutrality, only complementing it with the principle, that Moldova cannot become the member of military alliances. When speaking about Moldova’s position in international arena, the Con- cept of National Security simultaneously foresees both euro integration and strengthening the relations with the CIS. It is obvious that these two goals are incompatible and neutralize each other17. Moreover, considering cooperation with NATO, it is emphasized that Moldova doesn’t seek NATO membership. Obviously, it is not necessary to state it separately, because Moldova’s relations with military alliances (not only NATO) are described by the principle of neutrality. Otherwise, the emphasis on NATO could make a negative impact on Moldova’s cooperation with Alliance in the future. Thirdly, after the approval of the new Concept of National Security, the Concept of Foreign Policy remained unchanged (nevertheless the project of the

15 Lege Nr. 112 din 22.05.2008 pentru aprobarea Concepţiei securităţii naţionale a Republicii Moldova, [Law No. 112 of 22 May 2008 for the Approval of the National Security Concept of the Republic of Moldova], Publicat : 03.06.2008 în Monitorul Oficial Nr. 97–98 art Nr : 357 (in Romanian). 16 Mînzărari D., Proiectul Concepţiei securităţii naţionale – test decisiv pentru elita politică moldovenească (note 13), p. 6. 17 Grosu V., “Consideraţii privind Contepţia securităţii naţionale a Republicii Moldova” [“Considerations in respect of National Security Concept of the Republic of Moldova], Securitatea naţionala – imperativ strategic, Jurnal academic Mai 2008, ediţia 9, Centrul informare şi documentare privind NATO din Moldova, p. 12 (in Romanian). 165 new Concept of Foreign Policy was prepared). So, now Moldova’s foreign policy priorities are foreseen by the 1995 document, which nowadays is completely out of date and doesn’t accord current international and regional situation. In 1995, when the Concept of Foreign Policy was adopted, EU integration was not on the list of Moldova’s priorities, so the document foresees more realistic priority for that time – integration into the CIS18. So, now Concept of National Security foresees EU integration, at the same time Concept of Foreign Policy – country’s integration into the CIS. The problem of incompatibility of strategic documents makes both documents only formal, leaving Moldova’s security policy without firm ground. Small states, acting in the international arena, often intend to minimize possible risks, not to maximize the winnings19. This aspect of behaviour determines cautious, reactive foreign policy of a small state. But in the case of Moldova, the developments of the geopolitical situation and the country’s geopolitical orientation are being reflected in the practical foreign policy only, separating security policy from these processes. As a consequence, Moldova’s security strategy, formulated in 1994-1995, remains “frozen”. The paradox of Moldova’s security policy is determined by the fact that country’s strategic documents were adopted primarily seeking to “inform” external players (first of all – Russia) about the directions of country’s security policy, but eventually these documents became a “permanent bra- ke”, preventing the country form the possibility to choose more relevant and well-balanced security strategy. In this way, Moldova’s security strategy has become “trapped”.

2.2. The Problems of Permanent Neutrality

One of the most actual and most discussed issues of Moldova’s security policy – declared permanent neutrality. Moldova’s security strategy from the very start has not been the independent choice, but rather the consequence of the “neutralization” of the country20. On 27 August 1991 Moldova declared its independence, after what it was expected, in the case of optimistic scenario – reunification with Roma- nia, in the case of realistic scenario – close ties with the neighbour. Russia was frightened of losing a former partner and made every effort to turn Moldova to at least the path of neutrality. The strongest card Russia held was the conflict with Transnistria, which broke out in the fall of 1990 and has not been resolved yet. Russia interfered in the conflict by deploying its military forces in the

18 Munteanu I. et al, 100 cele mai presante probleme ale Republicii Moldova in 2006 [100 Key Problems of the Republic of Moldova in 2006], Studiu de analiză, IDIS Viitorul, Chişinău, 2006, p. 187 (in Romanian). 19 Handel M. I., Weak States in the International System. London: Frank Cass, 1970, p. 52–53. 20 Mînzărari D., Proiectul Concepţiei securităţii naţionale – test decisiv pentru elita politică moldovenească (note 13), p. 43. 166

Transnistria, which de jure is a part of Moldova. So, in 1994, when adopting the Constitution, the first document to officially declare the status of neutrality, Moldova had a breakaway region with the military forces of foreign country, dislocated in it. The refusal from neutrality at that time could determine both the use of Russia’s armed forces and final separation of Transnistria from Moldova. Reacting to this situation, Moldova overtook declarative neutrality. Thus in the beginning of the 1990’s, Moldova’s Government had several reasons to declare neutrality (declare, not choose, because Moldova has never been neutral country by the definition). First of all, a declared neutrality made it possible for Moldova, despite growing pressure, to remain outside the Russia- dominated security and military structures, such as Collective Security Treaty Organization21. Moldova became the member of CIS in 1991, mainly striving to maintain mutually beneficial economic and social ties with other post-soviet states. Nevertheless, Moldova avoided cooperation in foreign policy and security fields in the context of CIS. In 1993, Moldova, together with Georgia and Azerbaijan, signed CIS Articles of Agreement with the exception to cooperation in military-political dimension22. Thus, Russia’s pressure for Moldova to join the CSTO has been felt up until now23. Second, a Constitution of the Republic of Moldova has been adopted already after the unsuccessful for Chisinau armed conflict with breakaway Transnistria, which took place in summer 1992. Constitutional provision of neutrality was one of the conditions, which facilitated Chisinau’s cohabitation both with breakaway Transnistria and with Russia, which deployed its military forces in Moldova’s separatist region. Moreover, Moldova’s Government hoped that the principle of permanent neutrality, fixed in the main country’s law, would prompt Russia for faster demilitarization of Transnistria. Following this logic, if Russia is willing to see Moldova as neutral country, it should respect the basic principles of neutrality, fundamental of which is non-hosting of foreign armed forces in neutral territory. Third, some experts claim that neutrality allows country to save on the expense of defence sector, not developing strong armed forces24. This approach is supported by the insight that a strong army is not enough for the state to maintain its national security in the contemporary international system25. So, the resources, saved on the expenses of “hard” security sector, could be redistributed to other important sectors, enhancing “soft” security and at the same time avoiding so-called “security dilemma”.

�� Marandici I., “Moldova‘s Neutrality: What is at Stake?” in Quo Vadis, Moldova?, Lviv: Multi-M, 2007, p. 47. �� Tăbârtă I., Berbeca V., Proiectul CSI: Anatomia unui eşec [The CSI Project – Anatomy of One Failure], Politice publice Nr. 7 2009, IDIS Viitorul, 9 (in Romanian). 23 Molodilo D. (note 7), p. 90. 24 Cebotari S., Saca V., “Republica Moldova între statutul de neutralitatea şi aderarea la NATO” [“The Republic of Moldova Between Status of Neutrality and the Perspective of NATO Membership”] in Studii internaţionale: viziuni din Moldova. Publicaţie periodică ştinţifico-metodică,Nr. 3(4), 2007, p. 68 (in Romanian). �� Gorincioi R., “Developing National Security Concept and Strategy: Assessing Existing Needs and Risks” in European and NATO Neighbouring Policies –New Dimensions for Rregional Ccooperation, Training Seminar, Chisinau, Republic of Moldova, November 28–29, 2007, p. 52. 167

Nevertheless states that choose neutrality as their security strategy seek more flexibility and a wider manoeuvre space in other spheres, the neutrality strategy is very rigid in regard to country’s security policy. In the security policy field, neutrality limits the area for state’s actions to its national borders. In other words, neutrality minimizes the possibilities for a small state to search for “external sources of security”. So, in the case of Moldova, a precipitous decision on neutrality raises several problems. Firstly, the neutrality should be not only declared by the particular state unilaterally, but also recognized by international community. Other states (or other subjects of international relations) should perceive the particular state as neutral. It is also worth mentioning that in the contemporary international arena neutrality in its pure form is very rare security strategy. Either historically neutral states (for example, Switzerland) or states that are balancing between great powers by the help of economic resources (for example, Azerbaijan) are usually perceived as neutral. At the same time Moldova has never been perceived as neutral26 by the actors of the international community. Moreover, Russia intends to violate Moldova’s neutrality by deploying its military forces in the country’s jurisdiction. Due to this, unilaterally declared Moldova’s neutrality performs only as guidelines for country’s security policy at best, but not as a real security strategy, aiming to guarantee the security of small state. Secondly, the security of the state, situated in the zone of high geopolitical tension, should be guaranteed by the “external” source of security – state or the group of states, providing security guarantees for a small state27. The neutrality of small state also should be supported “from the outside”, by formal or informal mechanisms. But the neutrality of Moldova fails to have any “external” guarantees, neither formal, nor informal28. In addition, the status of neutrality restricts Moldova’s external cooperation in the field of security. Thirdly, Moldova’s neutrality strategy fails to fulfil its main function – to guarantee the country’s security. Adversely, the neutrality adds to the “conservation” of the situation of insecurity. After Russia deployed its military forces in separatist Transnistria, Moldova has not only been unable to press de facto authorities in Tiraspol for faster conflict resolution, but also to search for assistance on this issue outside its borders. As it already has been mentioned, Moldova encounters the greatest threat to its national security at the local level. Due to this neutrality, which is designed to help the state avoid being in high geopolitical tension, in Moldova’s case is not an optimal security strategy. Fourthly, Moldova’s declared neutrality slows down the process of

26 Mocanu Gh., 100 cele mai presante probleme ale Republicii Moldova in 2008 [100 the Most Presented Problems in the Republic of Moldova in 2008], IDIS Viitorul, Chişinău, 2009, p.243 (in Romanian). 27 Spiegel S., Dominance and Diversity. The International Hierarchy. Boston, 1972, p. 133, 136. From: Am- strup N., “The Perennial Problems of Small States: a Study of Research Efforts”, Cooperation and Conflict. Nordic Journal of International Studies. Vol IX, No. 3, 1976, p. 170. 28 Munteanu I. et al, Moldova pe calea democraţiei şi stabilităţii din spaţiul post-sovietic în lumea valorilor democratice [Moldova on the Path of Democracy and Stability in the Post-Soviet Space in the Contex t of Democratic Values], IDIS Viitorul, 2005, p. 247 (in Romanian). 168

reforming and developing country’s armed forces. The principle of permanent neutrality, nevertheless fixed in the Constitution, is not explained in the strategic documents. Vague country’s security strategy fundament indicates that Moldova’s politicians, when adopting the principle of neutrality, had obscure vision what the neutrality is about how it should function in the case of Moldova. For this reason, the situation within country’s armed forces, inherited from the Soviet period, have been frozen, and the necessary reforms have been delayed29. These circumstances lead to the weakening of the country both in external (as a reliable partner in international arena) and internal security dimensions. Moreover, the function of country’s security strategy is not only to guarantee the maintenance of the statehood, but also to facilitate to the realization of national interests30. On the one hand, the weak articulation of Moldova’s national interests – one of the reasons, why the country failed to choose more efficient security strategy and has been forced to stick to the declarative neutrality. On the other hand, the neutrality strategy has been blocking the review of country’s national priorities. So, Moldova has appeared inside “closed circle” – the state fails to review its national interests because it is forced to stick to the declared neutrality. So, it is obvious that the declarative neutrality not only hasn’t improved the country’s security situation, but also may lead to its deterioration. The Cons- titutional provision of neutrality could be abandoned only by referendum (The Constitution of the Republic of Moldova, Article 142, Part 1)31. Public opinion surveys show that majority of Moldova’s citizens (in November 2009 – 58.8 percent) are in favour of neutrality as a strategy, capable to guarantee Moldova’s security32. The demand for neutrality in Moldovan society could be explained by several factors. First of all, Moldova’s society in early 1990’s experienced armed conflict with the breakaway Transnistria nevertheless the conflict itself was not of a high intensity, people hope that neutrality would prevent them from another armed conflict in the future. In other words, Moldovan society accepts the neutrality security strategy not because of its capability to improve the security situation, but because it could add to the stability of the current security situation, preventing it from possible further deterioration. Second, the early transition period of the independent Moldova, which coincided with the pro-Romanian political moods, terminated in the disappointment of the majority of citizens, especially – in economic and social fields. So, a part of

29 Busuncean T., “Controlul democratic asupra reformei sectorului de securitate în Republica Moldova” [“Democratic Control on the Reforms of Security Sector in the Republic of Moldova”] in Studii Internaţionale: Viziuni din Moldova. Publicaţie periodică ştinţifico-metodică,Nr. 3(4), 2007, p. 55–56 (in Romanian). 30 Gorincioi R., “Developing National Security Concept and Strategy: Assessing Existing Needs and Risks” (note 15), p. 57, 59. 31 Constituţia Republicii Moldova (note 11). 32 Barometrul Opiniei Publice, Republica Moldova, Noiembre 2009 [Barometer of Public Opinion, the Re- public of Moldova, November 2009], Institutul de Politice Publice, p. 110. From http://www.ipp.md/files/ Barometru/2009/final_bop_noiembrie_2009_recap.pdf [2009-12-21] (in Romanian). 169

Moldova’s society perceive neutrality as a “check” from the failures of pro- Romanian policy in the future. Moldova’s neutrality simultaneously suffers from two major shortcomings – it is both inadequately chosen and inappropriately implemented. In the case of inadequate choice, the paradox is that the state sacrifices more in the field of security policy than gets “in return”. This situation could be named as “a pure loss”, which has negative impact not only for security sphere, but also for other spheres (for example, foreign policy). Moreover, this unhealthy situation may lead to the decrease of state’s structural power. Inappropriate implementation of the Moldova’s neutrality strategy includes several factors: external, which do not depend directly on Moldova (frozen Transnistrian conflict, Russia’s military presence in Moldova), and internal (Moldova’s Government perceives neutrality not as balancing, but as inaction). If Moldova’s government would change its attitude towards neutrality – this means to perceive that neutrality also could be implemented actively, there would be a possibility that external factors would be reduced in time. The creation of the basic conditions for Moldova’s neutrality to function could minimize the threats to the country’s security (negative goal of the security strategy). Nevertheless, appropriate implementation of neutrality strategy doesn’t solve the problem of inappropriate choice. Even if Moldova’s neutrality would function well, finally it would be “goal for itself”. This would restrict the development of country’s structural power (positive goal of the security strategy).

3. Factors of Moldova’s Neutrality

The neutrality strategy, applied by Moldova, has been raising more security challenges then providing solutions. Although it could be said that both the adoption of declarative neutrality in early 1990’s and maintenance of it have been rather the outcome of the specifics of the Moldova’s domestic and external policies issues then their cause. In other words, Moldova’s choice (even if it has been not optimal) to implement a particular security strategy was anticipated by the number of factors of various intensity. The problem of permanent insecurity of a small state and the efforts to defend its security are closely connected with the external factor. Due to the high level of vulnerability the small state depends of international conjuncture. Although the final decisions in the sphere of security policy belongs to the small state itself, nevertheless the configuration of great powers in the international arena implies several restrictions on the choices, available for small state. The sources of Moldova’s neutrality are analyzed from the perspective of three approaches of international relations – realism, pluralism and constructivism. 170 3.1. Identity Crisis and the Problem of Political Choice for Moldova

Analyzing the choice of the neutrality strategy from the perspective of constructivism, the key factor, determining the choice of neutrality and it’s maintenance for Moldova – country’s balancing between pro-Romanian and pro-Moldovan political identities. A sophisticated and ambiguous history of Moldova33, soviet “heritage” and fragmentary identity policy of newly independent Moldova led to the deep cleavage in Moldova’s political identity – since the restoration of independence concepts of Romanian and Moldovan state identities have been confronting. Struggle for Moldova’s independence started from the ethnic Romanian movement. On 27 August 1989 ethnic-intellectual movement – Great Assembly (rom. Adunarii Mare) – started. During the Great Assembly, which converted to several days’ of protest, the following demands were formulated: the legal status for Romanian language as a state language, sovereignty for Moldova and the adoption of new Constitution. On 31 August 1989, after a very tense sitting of Supreme Council of Moldova Soviet Socialistic Republic, then chairman of Supreme Council Mircea Snegur (after the restoration of independence he became the first president of Moldova) declared Romanian language an official language of the Moldova Soviet Socialistic Republic. In the Declaration of Independence, adopted after almost two years (27 August 1991), the reference to the decision to announce Romanian as state language is made. The tricolour flag of Romania with the Moldova’s coat of arms in the middle was adopted as a flag of Moldova, aiming to emphasize the historical brotherhood of both countries. Romania’s anthem “Wake up, Romanians!” (rom. “Deşteaptă-te, române!”) was chosen as Moldova’s anthem34. Similar processes took place in Romania. After the overthrow of autho- ritarian regime of Nicolae Ceauşescu, Romanians cherished hopes for restoration of “historical truth” and widely supported Moldova, which split from the Soviet bloc. Romania was the first state to recognize a newly independent Moldova and to establish diplomatic relations – the first embassy in Chisinau

33 The Moldova’s principality formed in mid-XIV ct., about the same time organized entities in Wallachia and Transilvania emerged. In XVI ct. those three regions, inhabited by ethnic Romanians, set first personal union. In 1859, also through the common ruler, two Romanian lands – Wallachia and Western Moldova – unified, forming the nucleus of modern Romania. New state in 1881 was oficially named Romania. Bessara- bia – the territory between rivers Prut and Dniestr, almost coinciding with the territory of contemporary Moldova (exept Transnistria), since 1812 had been occupied by Russian Empire. At this time difference between denominations “Moldova”, historical territory, which included Bessarabia and Western Moldova (territory between Prut river and Carpatian Mountains, now – Eastern Romania) and “Bessarabia” (territory between Prut and Dniestr rivers, inhabited by ethnic Romanians) formed. At the begining of 1918 Bessarabia proclaimed it‘s independence and declared the unification with Romania. Statehood of Romania, including Bessarabia, lasted till 1940. 34 Caşu I., “Politici identificare în Moldova sovietică şi post-sovietică” [“The Identity Policies in Soviet and Post-Soviet Moldova”], RO-MD/Moldova în două scenarii, Centrul pentru artă contemporară, Chişinău, 2008, p. 67 (in Romanian). 171 was Romania’s35. So, Moldova had a strong partner in the international arena from the very beginning of its independence. In the early 1990’s, the international community including Romania itself, treated Moldova’s independence as an interim stage towards the reunification with Romania. Thus due to the odds, which showed up later, Moldova had been willing more and more to maintain its statehood. Soon brotherhood with Romania had been gradually changed with tension, which than grew to hostility, and pro-Romanian identity was replaced by pro-Moldavian one. The existence of a so-called pro-Moldavian identity was the result of half a century of soviet propaganda. The political authorities of USSR aimed to antagonize Romania in relation to Moldova to the greatest possible extent. The core instrument had been the neglect of Moldova’s inhabitants’ identity as Romanians. Moreover, soviet authorities made huge efforts to create “scientific approval” of the existence of Moldovan ethnos, as separate and different from Romanian ethnicity. To be exact, the historical sources provide reference to the denomination “Moldovan”, but, according to the historians, it is the reference to the territorial, not ethnical relation – “Moldovan” was the denomination of Romanian, living in the Principality of Moldova36. Soviet moldavists aimed to prove that Moldovans are culturally and linguistically different from Romanians and have their own historical destiny. To facilitate the realization of this goal, artificial Moldovan language was created: Romanian language, rewritten in Cyrillic alphabet, was denominated as Moldovan. Moreover, the citizen of Soviet Moldova was free to identify himself with any nationality – Moldavian, Russian, Ukrainian, Jewish, Gaguz, but no way with Romanian. Declaration in publicity that you are Romanian, threatened with penal case for the provocation of nationalism or even action against territorial integrity of Moldova SSR. Charges could be brought also for the “too correct” usage of the (Romanian) language.37 Soviet-indoctrinated Moldovan identity revived in 1994. In the Cons- titution, adopted the same year, inexistent Moldovan has been foreseen as the state language. By this move, Moldovan politicians aimed to emphasize Moldova as separate from Romania. Moreover, in the same 1994 the decision to change the national anthem was taken – “Wake up, Romanians!” was replaced by the lyrics of Alexander Mateevici “Our language” (rom. “Limba noastră”). The image of Romania as a rival force, dangerous for Moldova’s sovereignty, was maintained till 2005. The refusal of Romanian identity was stimulated also by economic hardships: in 1994 Moldova suffered unprecedented economic decline, when country’s GNP, in comparison with 1989, decreased by 50 per cent. Just after several years – in 1998 – Moldova felt the grave consequence

�� Josanu Y. et.al. (note 5), p. 84. 36 Timpul, Pâslariuc V., “650 ani ai “statalităţii moldoveneşti”, proiect al elitelor “bugetovore”” [“650 years of Moldova‘s Statehood: the Project of “Suppliant” Elites”], Interviul de luni, 23 February 2009 (in Romanian). 37 Casu I. (note 34), p. 64. 172

of Russia’s economic crisis. On the one hand, at the period of huge economic decline people usually don’t give priority to the identity issues. On the other hand, at the time of economic decrease politicians in populist style used the allusion to “wealthy soviet era”, which raised the number of supporters of pro-Moldova identity. Also Russia’s factor was influential for abandoning pro-Romanian identity. In 2005, EU integration became a strategic goal of Moldova, so the then ruling Communist Party was forced to soften its tone in relation with Romania. Nevertheless, relations with Romania remained strained, and communists further escalated negative image of Romania inside Moldova. The tension in bilateral relations reached its peak after the April 2009 parliamentary elections, when communists accused Romania of staging the massive protests. After these protests communists government introduced visa regime for the citizens of Romania. Simultaneously an adverse process could be observed in Moldovan society: after 2003, when Moldova lifted its ban on dual citizenship, over one million of Moldovans expressed their willingness to obtain Romanian citizenship. Till now about 120 thousand of Moldovans are already granted with Romanian passports. The new stage of Moldovan-Romanian relations took place after the July 2009 early parliament elections, which, by a tight overweight38, were won by former opposition parties, which formed the alliance “For European Integra- tion”. The new pro-Romania government immediately lifted all the sanctions, introduced to Romania by communist government, and turned the political wheel towards closer relations with the latter. Prime Minister Vlad Filat during his first official visit in Brussels declared that his mother tongue is Romanian39. This was the first official declaration of this type since 1994. At the end of 2009 Moldova’s state institutions amended their websites, changing the option of Moldovan language (MD) to Romanian (RO) in the language options bar40. Romania, on its side, declared the readiness to significantly increase the level of granting the citizenships to Bessarabians – starting from 2010, it is planned to grant 100 thousand Romanian passports to Bessarabians annually41. Due to the absence of a stable political identity, Moldova’s security policy has been hanging between the West (primarily – Romania, also – EU and NATO) and the East (primarily – Russia and Russian-dominates CIS area). As it has been well noticed by historian Charles King, in the early 1990’s Romanians

38 The four-parties post-electoral alliance “For European Integration” gained 53 seats in 101-seat parliament, Communist party – 48 mandates. 39 Radio Free Europe/Radio Liberty, Moldovan Premier Wants “Clear EU Perspective”, Financial Aid, 30 September 2009. 40 Radio Free Europe/Radio Liberty, Moldovan Government Switches to “Romanian” Language on Websites, 28 October 2009. 41 Rodkiewicz W., From “Virtual” to European Democracy – the Origins and Consequences of the Political Breakthrough in Moldova, Centre for Eastern Studies, Warsaw, December 2009, p. 79 173 of Bessarabia woke up, but forgot to get out of the bed42. This situation led the country towards a neutrality security strategy, which is the political reflection of fluster between two competing identities. Geopolitically Moldova has no concrete dependence to a particular region. So, identity becomes the key factor, defining the “target” region (South- Eastern Europe, Black sea Region, Eastern Europe, CIS space). The choice on the region, to which Moldova would prefer to belong, would facilitate first, to identify the potential external sources of security, in regard to which Moldova should orientate its security policy, and second, it would help to define the threats and to design the options for their minimization.

3.2. Permanent Neutrality as Moldova’s “Neutralization”

Moldova’s identity, deeply polarized during the Soviet period, gave the impetus for the Transnistrian conflict to arise. The latter soon was frozen and became the hugest threat to Moldova’s national security. Looking from the perspective of realistic approach, Moldova, from the very start of its statehood, encounters the permanent hard security threat. Moreover, this threat is of highest intensity – the threat to state’s territorial integrity. After the August 2008 Russian-Georgian war, which created the precedent for “extreme” use of frozen conflict, Moldova’s hard security threat became even more dangerous.

3.2.1. Frozen Conflict with Transnistria – Permanent Threat to Moldova’s Security

Transnistria – a narrow strip of land with about 500 thousand inhabitants, situated on the left bank of river of Dniestr. This territory historically has never belonged to Moldova and was attached to Bessarbia only in Soviet times. In the Soviet era Transnistria became the industrial centre of Moldova: this tiny region produced some 90 percent of electricity, consumed by Moldova SSR, and created about 40 percent of Moldova SSR GDP43. Transnistria was settled by Russian-speakers from all USSR, who have never learned Romanian (then called “Moldovan”). On 31 August 1989, the Supreme Council of Moldova SSR adopted the law, providing the official state language status to Romanian language, after which a wide-range protest started in Transnistria. This transformed into separatist movement. According to experts, protests of Russian-speaking people in Transnistria certainly were

42 King Ch. (note 8), p. 224. 43 Trilateral Plan for Solving the Transnistrian Issue. Regional Partnership for a Common Commitment Oriented Approach. Policy paper, developed by Moldova-Ukraine-Romania expert group. Bucharest- Chisinau-Kiyv, January 2006, p. 14. 174

staged, because local inhabitants could hardly give such an immediate reaction to the law on state language44. Although the Law on the state language became the pretext for a separatist processes in Transnistria to gain speed. Referring to the “fear of Romanian nationalism”, on 2 September 1990 de facto Transnistrian Moldavian Republic (TRM) declared the secession from Moldova, elected de facto president (this post for four terms successively has been occupied by Igor Smirnov) and adopted its own Constitution. Moldova hasn’t accepted the secession of the region. As a consequence of this in the fall of 1990 in Dubassary and in the spring 1992 in Bendery, bloody clashes occurred between Moldova’s forces and Transnistria’s de facto forces. In the summer of 1992 Russia sent the 14th Army (reservist military formation) to pacify the upheaval. When the upheaval was pacified, the 14th Army has remained in Transnistria to safeguard Russia’s military equipment, left in Transnistria after the disintegration of USSR. In 2000, there was about 42 thousand tons of Russian ammunition. According to OSCE, during 2000-2004 some 50 percent of Russian ammunition left Transnistria (was transported or destroyed at the place).45 Currently some 1,500 Russian soldiers and some 20 thousand tons of Russian ammunition are still deployed in Transnistria. On 21 July 1992 Russia, Moldova and Transnistria signed a Cease-fire agreement. Nevertheless Russia declared acting as a mediator between conflicting Moldova and Transnistria, the participation of Russia in the cease-fire agreement confirms that the real conflicting sides are Russia and Moldova, not Moldova and Transnistria.46 Moreover, a cease-fire agreement has programmed one more deadlock. According to this document, Joint peacekeeping forces, consisting of five Russian, three Moldovan and two Transnistrian battalions, were formatted. Joint peacekeeping forces were dislocated in security zone (10 km row along the Dniestr, from both sides of Dniester). But the Cease-fire agreement failed to foresee the deadline, when Joint peacekeeping forces (consisting mainly Russian military forces) should leave the region47. On 21 October 1994 Russia and Moldova signed the agreement on the term and status of Russian military forces in Moldova’s territory. By this agreement Russia has taken on the responsibility to withdraw its military forces from Moldova over a three years’ period from the moment, when this

�� From the interview with former Minister Counsellor of the Republic of Moldova in Romania dr. Gheorghe Căldare, October 2009, Chisinau. 45 Asarov B., “Transnistria: riscuri şi provocări militare, politice şi de altă natură” [“Transnistria: risks and provocations of military, political and other origins”] in Munteanu I. et al, Moldova pe calea democraţiei şi stabilităţii din spaţiul post-sovietic în lumea valorilor democratice, IDIS Viitorul, 2005, p. 124 (in Ro- manian). 46 Busuncean T., “Separatism in the Black Sea and Caspian Sea Region as a Source of International Ter- rorism”, Combating Terrorism Working Group, PfP Consortium https://consortium.pims.org/filestore2/ download/2339/ctwg_separatism_in_the_black_sea.pdf 47 Trilateral Plan for Solving the Transnistrian Issue. Regional Partnership for a Common Commitment Oriented Approach (note 43), p. 7–9. 175 agreement comes into the force48. Nevertheless, Russia has never implemented this agreement. Since 1997, the resolution of the Transnistrian conflict has been negotiated in format “5-2” (Moldova, Transnistria, Russia, Ukraine and OSCE plus EU and USA as the observers included in the format in 2005). Still negotiations are ineffective due to asymmetry of power: Russia in fact has two voices against one Moldova’s voice, at the same time all the rest participants of negotiations have been acting more as observers, not as mediators. Also direct meetings of Moldovan and Transnistrian representatives at the “initiative” of one of the sides are in the deep deadlock (the sides haven’t met for eight years already). This refers to the few interest of one of the sides in resolving the conflict. In 2003 Moscow offered Chisinau to resolve the Transnistrian conflict by forming a federal state of Moldova. The plan of Moldova’s federalization, foreseen in Kozak memorandum (the author of this plan – Dmitry Kozak, former deputy head of President’s administration of Russian Federation), raised a grave negative reaction both from Moldovan civil society, the EU and the West. The Kozak memorandum was rejected for several reasons. First, it foreseen disproportional participation of Transnistria’s representatives in the central structures of common government institutions, what provided the breakaway region with blocking minority in common state institutions. Second, Kozak memorandum foreseen that Russian armed forces would remain in Moldova’s territory until 202049. Moldova, seeking the fastest possible withdrawal of Rus- sian military forces from its territory, foresaw this provision as attempt for its indirect occupation. Frozen conflict with Transnistria has been the main source of threats to Moldova’s national security. First and foremost, only due to the existence of frozen separatist conflict Moldova encounters the permanent threat to its territorial integrity. Secondly, Russian military forces, dislocated in Transnistria, raises the hard security threat, especially when Moldova itself has small military forces (small professional armed forces, designed for assisting to keep public order inside the country and to participate in international peacekeeping operations)50. As the Georgian precedent of August 2008 has shown, Russian armed forces, dislocated in Moldova, could be used against Moldova at any moment. Thirdly, the Soviet “heritage”, left in Transnistria – a huge arsenal of guns and ammunition – raises threats of both hard and soft security. The bigger part of guns, kept in the Kolbasna (Transnistria) ammunition store, is in very poor state. It is worth mentioning that during the Cold War, the Kol- basna ammunition store was the biggest gun store in Europe. According to

48 Solomon C., Gumeniuc A., “Conflictul Transnistrean şi procesul de negocieri în formatul “5+2”” [“Transnis- trian Conflict and it‘s Regulation Process in “5+2” Format],MOLDOSCOPIE (Probleme de analiză politică), Nr. 3 (XLII), 2008, p. 176 (in Romanian). 49 Solomon C., Gumeniuc A. (note 48), p. 178. 50 Mocanu Gh. (note 26), p. 243. 176

the independent estimations, in Kolbasna there could be dislocated about 10 thousand tons of explosives (throtyl), the explosion of which would equal the explosion of atomic bomb in Hiroshima in 194551. Due to it being in such poor state it is dangerous to transport the weapons, the optimal solution would be to destroy the out-dated ammunition at the place. Nevertheless, seeking to avoid environmental threats (it could lead to the increase of the pollution of Dniestr), the special costly technologies for destroying the weapons should be used. One of the reasons, why Russia stalls the withdrawal of its military forces from Moldova’s territory, is that Russia still cannot afford the destruction of the outdated military equipment. Fourth, Transnistria, ruled by illegal criminalized regime, has become the regional “centre” of illegal weapons trade. Transnistria has not only the huge reserves of Russian military equipment (objectively it should be mentioned that soviet ammunition acts more as an environmental threat then a threat to the hard regional security), but also holds the full cycle of the weapons production. In region metallurgic factory, the factory of mechanic parts for ammunition are operating, the factory “Elektromash” produces shooting weapons of several types, plant “Tolikomash” produces anticipators of mines and has no analogue in the whole CIS. Moreover, it has been disclosed that Transnistria provided weapons for Abkhazia, the breakaway Georgian region52. So, Transnistria could provide weapons also for terrorist and extremist groups. Weapons trade is not the only one illegal activity of Transnistria, which due to weak border control, acts as a “black hole” for organized crime (trade in arms, drugs and people). Huge amounts of contraband are directed through Transnistria. In 2005 the EU Border Assistance Mission (EUBAM) was dislocated at the Moldova (Transnistria)-Ukraine border. Since 2005 the amount of contraband significantly decreased, but still it remains relatively high. Only in 2008, at the Moldova-Ukrainen border and only in official cross-border checking points about 300 illegal cargos, worth some 1 million euro, were intercepted at the custody53. On 3rd March 2006 Moldova and Ukraine began to implement the new custody order, according o which all export goods from Transnistria had to receive stamps of Moldovan custody. This order was called “economic genocide” by Transnistria leaders. The vocal fact is that Russia supported the separatist region and even allocated humanitarian assistance for it. Ultimately, Transnistria has been acting as Russia’s instrument for controlling Moldova’s foreign policy and to maintain country’s neutrality. The perfect illustration of this tendency is Kozak memorandum, proposed in 2003, which, if implemented, would have transformed Moldova into Russia’s vassal. Moreover, Russia has actively supported the nationalist and extremist youth organizations in Transnistria, educating the opponents of reintegration

51 Busuncean T., “Separatism in the Black Sea and Caspian Sea Region as a Source of International Ter- rorism” (note 46). 52 Asarov B. (note 45), p. 129–130. 53 Mocanu Gh. (note 26), p. 238. 177 with Moldova and Moldova’s pro-European orientation. Most active and most numerous youth organizations in Transnistria are “Proryv” (“Outbreak”) and the youth branch of Russian National Bolshevik Party. When necessary, these organizations could act on behalf of local forces, dissatisfied with Moldova’s policy. Two terrorist acts have already been tied to these organizations: in the spring of 2006 – the explosion of grenade in public transport in Tiraspol, and similar act in October 2009 in Chisinau during the public concert54. Due to the unresolved conflict with Transnistria Moldova has been seen by the international community as a single-issue country55, what hinders Moldova from receiving multi-sided attention from international partners and to follow the path of sustainable development. Moldova’s security strategy of neutrality, which had to facilitate the compromise with breakaway Transnistria, still hasn’t provided with any results. Moreover, the paradox is that the Transnistrian conflict, due to which Moldova was forced to adopt neutrality, is the main obstacle to recognize Moldova’s neutrality. At the same time Moldova is a “hostage” of unilaterally declared neutrality, because efforts to change the security strategy could provoke the shift of Transnistrian conflict from the frozen to an active phase.

3.2.2. Challenges for Moldova after Russian-Georgian War

The unpredicted armed conflict of August 2008 between Russia and Georgia, was a serious signal that has reminded of Moldova’s security “deficit” and has stimulated the discussions on the efficiency of country’s security strategy. First and foremost, Moldova understood that it could become the next victim of Russia’s aggression. This threat has been heightened by the fact that Moldova has been “punished” by Russia several times already. In 2006, after pesticides were claimed to be found in Moldovan wines, the import of Moldova’s wine production to Russia was forbidden56 (the import has not been fully restored until now). At the same time embargo for Georgian mineral water and wines also was introduced by Russia. Until the restrictions of imports, some 90 percent of Moldova’s wine production was directed towards Russian market. So, it goes without saying that the closing of Russian market for Moldova’s main export production should have had political reasons – it was Russia’s “revenge” for Moldova’s increased European and Euro-Atlantic ambitions. In 2005, Moldova and the EU signed a three-year Moldova-EU Action Plan, in 2006 – biannual Moldova-NATO Individual Partnership Action Plan (IPAP), in 2005 EUBAM was dislocated at the border of Moldova-Ukraine.

�� From the interview with associated expert of IDIS Viitorul, Mgr. Vitalie Grosu, October 2009, Chisinau. 55 Mînzărari D., Ioniţă V., In NATO We Trust? Explaining Why Moldova Would Need to Join NATO, Discus- sion Papers, Debate on Current Affairs Series No. 3, October 2008-January 2009, IDIS Viitorul, p. 7. 56 Munteanu I. et al, 100 cele mai presante probleme ale Republicii Moldova in 2006 (note 18), p. 77. 178

Secondly, the threat for Moldova’s territorial integrity, raised by Russian- Georgian war, became more relevant than ever before. After Russia provided Abkhazia and South Ossetia with de jure recognitions, the possibility that Moscow could any time repeat this scenario with Transnistria significantly increased. It is interesting that Russia demonstrated Moldova it’s increased influence immediately – already the next day after the de jure recognition of Abkhazia and South Ossetia Moldova was reminded of the Kozak memorandum, which was rejected by the latter in 200557. Thirdly, armed conflict between Russia and Georgia pushed the whole Eastern Europe, which has already been situated in the “grey zone”, towards even deeper “vacuum of power”. In August 2008 at their meeting of Heads of NATO in Bucharest Georgia and Ukraine were refused to provide with Membership Action Plans (MAP). After the Russian-Georgian war talks of Georgia’s and Ukraine’s possible membership in NATO have silenced at all. The attention of USA to Eastern Europe significantly decreased after 2009, when President’s Obama administration turned towards the new stage of “reset” in the relations with Russia. On the other hand, after August 2008 the role of Russia as a guarantee of security in Eastern Europe was definitely rejected. Currently Eastern European countries, including Moldova, are left with the only possibility – to wait for the outcomes of the new stage in USA- Russia relations. Nevertheless, ongoing changes in global security environment and growing tension in the Eastern Europe after Russian-Georgian war does not eliminate the problems of Moldova’s neutrality security strategy. In reverse, Russian-Georgian war have demonstrated that the use of military force against the state is returning to the list of options of foreign policy.58. In this context, the question of external guarantees of security should be of primary importance, especially for the small state. Moldova, recognizing the threat to become the continuality of Georgian precedent, is intended to refer to the factor of the NATO neighbourhood. Moldova’s government hopes that Russia should not take a decision to attack the country, which borders the NATO member Romania59. One of the reasons for ruling “Alliance for European Integration” to strengthen ties with Romania is the creation of “indirect” security shield for Moldova. Nevertheless, in spite of the growing importance of Romanian factor in Moldova’s security policy, Romania’s influence for Moldova’s security strategy in the short-medium term will remain indirect. The paradox is that direct Romania’s efforts to influence the security strategy of neighbour Moldova could provoke contrary effect. First, as it has already been mentioned, a large part of Moldova’s society

57 Markedonov S., ““The Georgian Crisis”, New Realities and Rules of Game” in The Black Sea Region: a Security Minefield or a Partnership Road, #4 Disscussion Papers, Intra-Regional Perspective of the Black Sea Affairs. 58 Mînzărari D., Ioniţă V., In NATO We Trust? Explaining Why Moldova Would Need to Join NATO (note 55), p. 18. 59 Mocanu Gh. (note 26), p. 225–226. 179 still remains Romanian-phobic. So, the more active Romania would support Moldova’s refusal from neutrality, the more Moldova’s society would defend the maintenance of the current security strategy. Second, Russia’s reaction towards Moldova’s relations with Romania, especially – in the security policy, it would be much more sensitive than that of Moldova’s cooperation with the NATO.

3.3. NATO in Moldova’s Security Agenda

One of the greatest shortcomings of Moldova’s neutrality strategy – restricted possibilities to choose external partners in the field of security. Ne- vertheless, analyzing from pluralist perspective, Moldova has found a way to bypass the rigid neutrality security strategy – the cooperation with Western security structures, especially – with NATO. One of the strongest arguments for Moldova to choose a neutrality security strategy, was the reluctance to participate in Russian-dominated post-soviet security structures, such as Collective Security Treaty Organization (CSTO). Until now Moldova has managed successfully to bypass all the issues of security dimension in the framework of CIS (the country does not participate in common military trainings and so on). Thus, the neutrality strategy does not withhold Moldova from developing cooperation with NATO, at the same time avoiding Russia’s reaction. The cooperation between Moldova and NATO began in 1994, when Moldova joined the Partnership for Peace (PfP) programme. Moldova became the second CIS state (after Ukraine) to join PfP60. It is interesting that Malta, which joined PfP year later, after the change of government withdrew from this format of cooperation by reasoning the withdrawal by the efforts to maintain the neutrality61. In 1997 Moldova joined the Partnership Planning and Review Process (9PARP), the same year the cooperation with Alliance in the scientific sphere was started62. In 2006, NATO and Moldova signed Individual Partnership Action Plan (IPAP), adopting the Plan to the Moldova’s status of permanent neutrality and reflecting country’s EU integration goal63. In the fall of 2006 NATO held in Moldova two military trainings - Cooperative Longbow and Cooperative Lancer. In 2007 Moldova hosted international military trainings Medceur-0764. The main advantage of Moldova’s neutrality status in the context of cooperation with NATO is - the development of the country’s relations with

60 Druc E., “North-Atlantic Alliance Cooperation Policy: Partnership for Peace” in European and NATO Neighboring Policies – New Dimensions for Regional Ccooperation, Training Seminar, Chisinau, Republic of Moldova, November 28–29, 2007, p. 28–29. 61 Druc E. (note 60), p. 29. 62 Druc E. (note 60), p. 30–31. 63 Druc E. (note 60), p. 33. 64 Marandici I. (note 21), p. 48. 180

the Alliance does not provoke harsh Russia’s reaction (contrary as in the case of Georgia). Moreover, Moldovan society is quite positive regarding the NATO. Analyzing the data of public opinion surveys, an interesting detail is mentioned: according to the surveys, to the question “What would be the optimal way to guarantee Moldova’s security?”, only 16.3 percent of society would choose NATO membership as an alternative to neutrality. But, asked “How would you vote, if referendum on Moldova joining the NATO would take place tomorrow?”, already 22 percent of questioned would be in favour of Moldova’s NATO membership65. These ambiguous results indicate, first, that that Moldova’s society, as political elite, treats country’s neutrality as an axiom (unquestionable fact). Second, the results of the surveys also indicate that NATO in Moldova is perceived more as a political organization than military block66, so the intensive cooperation with NATO does not challenge the country’s neutral status. Close cooperation with NATO is important for Moldova in several aspects. First, in the framework of IPAP (participation of Moldova’s military forces in common military and civil trainings with NATO and in other instruments of cooperation), Alliance helps Moldova to indicate the directions for reforming country’s security and defence sector, shares know-how of its members in this sphere. Having in mind the intermediate position of Moldova’s government towards the reforming country’s security and defence sector, the assistant and encouragement from the part of NATO is especially important. Cooperation with NATO has the biggest value-added on the issues of democratic control of armed forces, the cooperation between military forces and civilians and increasing the transparency of management of military sector. Secondly, cooperation with NATO allows Moldova to remain on the Euro-Atlantic security agenda. After Romania joined NATO and Moldova became the “direct” neighbour of the Alliance, Moldova’s importance for the NATO significantly increased. Moreover, NATO as an international organization, which disposes high level of prestige in international arena, plays significant role in maintaining and developing Moldova’s ties with particular NATO members. Direct contacts with NATO member states help Moldova to overcome the detrimental image of a “single issue state”. Thirdly, close cooperation with NATO is an integral part of Moldova’s euro-integration policy. Currently we can speak of “functional sharing” between the EU and NATO, where NATO has taken on the responsibility for guaranteeing the security of Euro-Atlantic space (EU efforts to develop its own military forces does not challenge the role of NATO in Euro-Atlantic space). The fact that all new EU members are also the NATO’s members could be directly linked to the need of ensuring Euro-Atlantic security. So, on the one hand, neutrality creates the favourable conditions for Moldova to develop cooperation with NATO, at the same time avoiding the

65 Barometrul Opiniei Publice, Republica Moldova, Noiembre 2009 (note 32), p. 110–111. 66 Munteanu I. et al, 100 cele mai presante probleme ale Republicii Moldova in 2006 (note 18), p. 211. 181 irritation of Russia. Nevertheless, on the other hand, unilaterally proclaimed country’s neutrality restricts Moldova’s possibilities to seek NATO membership. The elimination of NATO membership option from the Moldova’s security policy agenda is a serious problem with various implications67. First of all, if Moldova prepares for a real euro-integration (this means Moldova is decided one day to become full member of EU), the realization of this goal would be hardly successful without NATO’s membership due to several reasons. Firstly, it is less likely that the EU would decide to take full responsibility for ensuring the security of neutral Moldova, especially having in mind Russia’s influence and possible manipulations (this tendency is valid for the whole Eastern Europe). Secondly, NATO is not only the organization of collective defence, but also the instrument for promoting the democratic and Western standards in the security sector. So, the process of democratization and the consolidation of democracy in the state, which has moderate ties with NAYO, could be slower and not so multidimensional. Secondly, currently NATO is the only one Euro-Atlantic security organization, providing real defence quarantines for its member states. All the others universal or regional security organizations, “accessible” for Moldova, are either too much so influenced by Russia (for example UN, OSCE) and for this reason incapable to add to the resolving of Moldova’s security problems, or operating more like the “clubs for political discussions in the field of security” (for example, GUAM). Third, today NATO is the only political-military force, capable to carry out effective deterrence of conventional military threats. In this regard, NATO membership would help Moldova to solve the problem of Russia’s pressure and manipulation, at least in the sphere of hard security68. In addition, Moldova’s NATO membership perspective would have a positive “by-effect” – it would be one more common interest with neighbouring Romania. This would lead to the intensity of bilateral cooperation in various fields. Moreover, the appearance under the common “security umbrella” (or at least the streaming to appear there) would increase trust between the neighbours. Intensified ties and enhanced trust would help to resolve the problem of Moldova’s “divided” identity. The democratic political forces, which came into the power after the July 2009 early elections, view the cooperation with NATO much more posi- tively and seriously than communists. But the threat remains that the NATO issue could become the cleavage line inside the coalition. Two of four parties, forming the “Alliance for European Integration“ – Liberals and Liberal Demo- crats – support the review of Moldova’s neutrality (what would open at least

67 Gorincioi R., “Elaborarea noi concepţi de securitatea naţionala prin prisma cooperării cu Alianţa Nord- Atlantică” [“Elaboration of New National Security Concept from the Perspective of Cooperation with North- Atlantic Alliance] in Studii internaţionale: Viziuni din Moldova. Publicaţie periodică ştinţifico-metodică, Vol. IV, Nr. 3, 2007, p. 18 (in Romanian). 68 Mînzărari D., Ioniţă V., In NATO We Trust? Explaining Why Moldova Would Need to Join NATO (note 55), p. 34. 182

theoretical possibilities to Moldova’s NATO membership). At the same time Democratic party and Alliance “Our Moldova” are more likely to preserve Moldova’s neutral status. Looking from the pluralist perspective, Moldova’s neutrality means the “neutralization” of the pressure to intensively cooperate with Russia in the sphere of security, but not the aspiration to remain outside military alliances in general. So, it is likely, that, in case of the weakening of Russia’s factor in Moldova’s security policy, the NATO membership perspective would become an option for Moldova.

Conclusions

Moldova’s neutrality security strategy, chosen more than 15 years ago, failed to help the state to overcome the main security challenges. The inefficiency of Moldova’s security strategy was determined by several factors. First of all, Moldova’s neutrality security strategy has failed to prove itself because of the mistaken perception. Moldova’s neutrality, although was not explicitly explained in the strategic documents, was grounded not on the geopolitical argument – willingness to avoid the “zone of high geopolitical tension”, but on the threat of hard security – unwillingness to irritate Russia, which deployed it’s military forces inside the state, also – on the reluctance to participate in the Russian-dominated security structures. Secondly, the main function, foreseen for neutrality, was to facilitate the resolving of the conflict with breakaway Transnistria. But, although the conflict really is between Moldova and Russia, not between Moldova and Transnistria, Chisinau’s choice on neutrality was the big victory of Moscow. If Moldova remains neutral, this means – without external security guarantees, Russia gets the leverage to “freeze” the resolution of Transnistrian conflict as long as it is beneficial for the own interests of Russia. The determinant role of the Russian factor for Moldova’s security strategy is confirmed by the fact that at the time of declaring independence Moldova had been already faced with the problem of separatism. Nevertheless the 27 August 1991 Declaration of Independence has no reference to neutrality. The turning point in Moldova’s security strategy is observed after the signing of the cease-fire agreement between Moldova, Russia and Transnistria, which opened the way for undetermined presence of Russian military forces in Moldova’s territory. So, it could be concluded that Moldova’s neutrality is the reflection of Russia’s interests. In addition, the neutrality security strategy has not only failed to add to the resolution of Moldova’s security problems, but even may challenge the smooth realisation of the country’s national interests in the medium-long term. Especially it is said about the Moldova’s NATO membership perspective – rejecting the NATO membership may cost EU membership perspective for Moldova. 183

The process of the review of country’s Constitution, planned for 2010, gives some hopes that the status of permanent neutrality may be reconsidered once more. “Alliance for European Integration”, currently forming the ruling majority, is intended to use the period in institutional crisis in Moldova for the review and correction of the country’s strategic goals and guidelines. Un- til the mid-2010, when the parliament should be dissolved and the new early parliamentary elections announced, Moldova’s society would be mostly con- centrated on the issues of going out of institutional deadlock and the relation between authority branches. Moreover, the practice shows that during times of economic hardship society is less interested in the questions of security. So, Moldova’s security issues, if overviewed in the nearest future, most likely would not provoke the “wave of opposition” inside the country. However, as the analysis, presented in this article, shows, Moldova’s neutrality is the outcome of the country’s confusion within the new geopolitical situation. Accordingly, the technical rejection of neutrality would hardly bring any essential changes. Moldova’s government, aiming to create a stable background and favourable conditions for the new security strategy, should pay most of its attention towards minimizing Russia’s influence, solving the problem of a “divided” identity, diversifying country’s external relations and developing ties with the international community.

Chisinau-Vilnius, October-December 2009

National Security Issues

187

Egdūnas Račius* General Jonas Žemaitis Military Academy of Lithuania

Lithuania in the NATO Mission in Afghanistan: Between Idealism and Pragmatism

The article is first of all aimed at demonstrating how in the case of Lithuania’s participation in the NATO mission in Afghanistan the discourse that has spread by idealistic rhetoric figures, as a tool for creating a certain image of Lithuania (as an actor in international relations), is employed by the Lithuanian government to pursue pragmatic goals of the Lithuanian foreign policy, oriented toward a totally different geographic and mental space (in Lithuania, commonly referred to as ‘transatlantic space’) than the region, the Central Asia, in which the physical action takes place and in which Lithuania has no vested interests whatsoever. At the same time, making use of the concepts ‘construction of social reality’ and ‘social construction of knowledge’ formulated by Stefan Guzzini, the relationship between the image broadcast through discourse and the reality are analyzed. The article also seeks to tackle the question of whether, taking into account the worsening worldwide economic situation, specifically in Lithuania, as well as the security situation in Afghanistan, the chosen tactics of pursuing foreign policy goals will pay off in the long term perspective and what could be scenarios for further development. To answer the latter question, the new government-endorsed “Strategy of the participation of the Republic of Lithuania in the activities of the international community in the Islamic Republic of Afghanistan for the years 2009-2013” is analyzed in the last part of the article.

Introduction

In the four years since the establishment in the summer of 2005 of the Lithuanian military-led “Camp Whiskey” nearby the administrative centre of the Afghan province of Ghor, Chaghcharan, the Lithuanian government has been actively seeking to create a double image of Lithuania both at home and abroad. On one hand as an active and trustworthy ally and partner, and on the other hand as a capable and successful donor state. The audience of this image is also double: on the international level – the so-called “allies and partners” (first of all the American administration, but also top NATO officials and governments of the Alliance member-states), and on the national level – Lithuanian citizenry (the society). A third group directly linked to Lithuania’s

* Dr. Egdūnas Račius is an Associate Professor of the Political Science Department of the Military Acad- emy of Lithuania. Address: Šilo 5A, LT-10322 Vilnius, Lithuania, tel. +370-5-210 35 69, e-mail - egdunas. [email protected] 188

commitments in Afghanistan – Afghans, or, to be more precise, inhabitants of the Province of Ghor. The latter are to be identified as the target group. Top Lithuanian officials routinely present Lithuania’s participation in the NATO mission in Afghanistan as one of priorities of the Lithuanian foreign policy1. From an idealistic point of view, Lithuania’s participation in this international operation can be seen as a three-member structure, where the subject (the Lithuanian government) through its decisions makes a direct impact – comprehensively contributes to the reconstruction of the province – on the target group (inhabitants of Ghor) and then communicates the results (achievements) of that impact to the audience (the Lithuanian society and “allies and partners”). It is exactly this picture that is being constantly presented in the public by the Lithuanian politicians and the involved state institutions. However, under closer scrutiny of the real actions of Lithuania in the NATO mission in Afghanistan so far a somewhat different constellation of the members of this structure reveal itself, where the audience (in particular “allies and partners”) are practically turned into the target group, while the original target group (Afghans in the person of inhabitants of Ghor) become a mere means for the subject in achieving its pragmatic goals that have no direct relation with the original target group. In other words, at the hands of the Lithuanian government Afghans (first of all, the inhabitants of Ghor) have become a tool in creating the image of Lithuania as an active international relations subject, and the entire mission – a public relations campaign both within its borders and outside them. This article is first of all aimed at demonstrating how in the case of Lithuania’s participation in the NATO mission in Afghanistan the discourse permeated by idealistic rhetoric figures, as a tool for creating a certain image of Lithuania (as an actor in international relations), is employed by the Lithu- anian government to pursue pragmatic goals of the Lithuanian foreign policy oriented toward a totally different geographic and mental space (in Lithuania, commonly referred to as ‘transatlantic space’) than the region, Central Asia, in which the physical action takes place and in which Lithuania has no vested interests whatsoever. At the same time, making use of the concepts of ‘construction of social reality’ and ‘social construction of knowledge’ formulated by Stefan Guzzini2, the relation between the image broadcast by the discourse and the reality is analyzed. The article also seeks to tackle the question of whether, taking into account the worsening of the economic situation worldwide and specifically in Lithuania as well as security situation in Afghanistan, the chosen

1 Both the then minister of national defense Juozas Olekas, and the former chief of Armed forces general major Valdas Tutkus told the Baltic News Service (BNS) that Lithuania considers its participation in the NATO mission in Afghanistan a priority task, though underscored that the mission undertaken by the Provincial reconstruction team (PRT) in Ghor has brought Lithuania to the limit of its capabilities. See: Alfa.lt “Lietuvos įsitraukimas į veiklą Afganistane – tai vienas pagrindinių mūsų valstybės tarptautinių įsipareigojimų”, 04 04 2009. 2 Guzzini S., “A Reconstruction of Constructivism in International Relations”, European Journal of Inter- national Relations, 2000, vol. 6, no. 2, p. 147-182. 189 tactics of pursuing foreign policy goals will pay off in the long term perspective and what could be scenarios of its further development. To answer the latter question the newly government-endorsed “Strategy of the participation of the Republic of Lithuania in the activities of the international community in the Islamic Republic of Afghanistan for the years 2009-2013” is analyzed in the last part of the article.

1. The Nature of the Mission – Fulfilment of Obligations to NATO

The Lithuanian military have been taking part in the occupation of Afghanistan since the end of 2002, when a squadron of Special Operations Forces (SOF) of the Lithuanian Army joined the US-led “Operation Enduring Freedom” and until 2004 was succeeded by another three squadrons. In the summer of 2007 a SOF squadron joined the military operations of ISAF in the provinces of Kandahar and Zabul, and have since been replaced by several others. But due to secrecy of the SOF structure, personnel and modus operandi, the activities of SOF squadrons have not become a hot topic of discussions or a tool for creating of the image of the state. Though, there is an exception – an article by an American war journalist Michael Yon3 about the activities of the Lithuanian SOF in the province of Zabul, which was used by the Ministry of National Defence (MND) to enhance both its own prestige and the positive image of Lithuania’s participation in the occupation of Afghanistan. The Minis- try awarded Michael Yon a “Feather of the year” of 2008 in recognition of his “genuinely describe(ing) soldiers of the Lithuanian special military operation forces in the international operation in Afghanistan.”4 Contrary to the SOF, the Lithuanian-led Provincial Reconstruction Team, because of its origins and nature – it is the first self-governing Lithuanian mission of this kind – is in the eyeball of media since the very moment the Lithuanian government in 2005 made the decision to establish it. Historically by now (as of July 2009) the 26 existing PRTs can be divided into those which were established by the USA in the course of the “Operation Enduring Freedom” and those which were established after 2003 by individual states (NATO members and partners) under the umbrella of the International Security Assistance Force (ISAF). The main difference is related to the fact that most of the American PTRs since their very establishment had to operate in the active combat zone – in the southern, south-eastern and eastern provinces (the so-called ‘Pasthun Belt’), while the ISAF PRTs were established in rela-

3 Yon M. “On the Front Lines in Afghanistan, Part Two”, http://pajamasmedia.com/blog/on-the-front-lines- in-afghanistan-part-two/2/, 14 07 2010. 4 Ministry of National Defense, “JAV karo žurnalistui įteiktas “Metų plunksnos” apdovanojimas”, 2009-01- 22, http://senas.kam.lt/index.php/lt/181513/, 14 07 2010. 190

tively calm provinces. PRTs (among them the Lithuanian one) established in non-Pashtun provinces (in the western and northern parts of the country) until recently had much more favourable conditions to pursue the set objectives (the main ones being strengthening of influence of the Afghanistan’s government in provinces and creating conditions conducive for reconstruction of the provinces and the state). But, as analysts notice5, the activities of ISAF PRTs operating even in relatively secure provinces are developed very unevenly because apart from the security factor, the effectiveness of their activities is circumscribed by the available infrastructure, topographic and demographic peculiarities of provinces, and the capabilities of PRT banner-bearer state – the financial and human resources which that state can pull together for the reconstruction of the province. The godfathers of the Lithuanian mission (i.e. of the establishment and leading of the PRT), the then ruling Social Democrats (the Minister of National Defence G. Kirkilas and his successor J. Olekas) described the main goal of the mission in the following words: “to stabilize the situation both in Afghanistan and in particular in the Province of Ghor”.6 Since the security situation in Afghanistan in general, and especially in Ghor in the beginning of 2005 was almost satisfactory, no tense or dangerous service for Lithuanian representatives was forecast. Media then reported that according to Olekas: “the Province of Ghor, where Lithuanians will head the reconstruction works, in his opinion, has its advantages. J. Olekas argued that it is in the centre of Afghanistan, therefore there are no border problems, “where as a rule drugs’ and weapons’ paths go”. The MP saw also as an advantage the fact that this province for a while was watched over by an American mission and “after this stage will be surrounded by provinces where PRTs will be established”. This certain environment security, according to him, would guaranty greater safety.”7 Through such similar wording an image of a relatively safe and stable province, where no dangers for the health or life of the Lithuanian citizens ought to arise, was being created in the public, while totally keeping silent on the events pertaining to the dynamics of security situation in a recent past. This way, for instance, Lithuanian politicians concealed (and the media mentioned in just a few words) the fact that in the summer of 2004 a local warlord, Abdusalam Khan, with a purpose it is maintained, to concentrate in his hands as many weapons and drug production and dealing as possible, with his armed militia in an armed encounter made the government-appointed governor Ibrahim Ma- likzada flee and briefly took the provincial administrative centre Chaghcharan into his hands. The situation was normalized only after two weeks when the

5 Eronen O., “PRT Models in Afghanistan Approaches to Civil-Military Integration”, CMC Finland Civilian Crisis Management Studies, 2008, vol. 1, no 5. 6 ELTA, “Lietuvos misija Afganistane gali trukti keliolika metų”, 2005 03 25, http://www.politika.lt/index. php?cid=831&new_id=1974, 2009-11-05. 7 ELTA, “Lietuviai turi pasiruošti, kad misija Afganistane truks keliolika metų, tvirtina J. Olekas”, 2005 03 25, http://www.sekunde.lt/content.php?p=read&tid=10261, 14 07 2010. 191

President of Afghanistan temporarily dispatched a detachment of the Afghan National Army (ANA) to the province, where otherwise until now there is no permanent presence of the ANA. Around the same time, armed encounters between militias loyal to the then governor of the neighbouring province of Herat, Ismail Khan, and groups hostile to him took place in Ghor. Lithuanian media failed to make notice of that either. After announcing publicly Lithuania’s decision to involve itself in the expansion of the ISAF activities zone in the form of a PRT, Lithuanian politicians ascertained to the nation that this mission would not cost much to Lithuania. Media conveyed the assurances of the then Minister of National Defence G. Kirkilas that, “at the moment there are predictions that the mission in Afgha- nistan may cost Lithuania 400-500 thousand Lt per month. It is planed that for a year 8-9 million Lt will be allocated from the budget of the Ministry of National Defence. The main part from it will be conferred for the salaries of the soldiers departing for the province in Afghanistan.”8 In the context of economic growth, such amount, especially when the bulk of the money was to come back to Lithuanian citizens in the form of salaries for the soldiers serving in the mission, did not have to alarm even the very tight-fisted citizens of the country. In reality, however, the military expenditures already in the first year (when the US was still entirely financing the maintenance of the PRT in Chaghcharan) reached several tens of millions and during the entire 2005-2008 period made around 220 million Lt9. The godfathers of the mission were not disturbed by the apparently inauspicious natural conditions in the province of Ghor, or the degree of social and economic backwardness there: practically the entire territory of the province is covered by mountains ranging from two to three and a half kilometres in height, with steep slopes and deep passes. Therefore, the province is one of the hardest in the whole of the country. Winters last from October to April, and this allows for only one yield per year in the diminutive agricultural areas in valleys. During the winter season, once the snow covers crossings and roads, life gets slower in the whole territory of the province. For instance, there was a heavy winter in 2005 – several hundred people died from cold only in Ghor, and up to 100010 over all of the country. Several hundred others died in the spring because of floods caused by rapidly melting snow.11

8 Aleknaitė K., “Į Afganistaną siunčiamų karių skaičių gali prašyti didinti”, Delfi.lt, 2005 m. vasario 21 d., http://www.delfi.lt/archive/article.php?id=6086612, 14 07 2010. 9 Such amount is indicated in one of the drafts of the “Strategy of the participation of the Republic of Lithu- ania in the activities of the international community in the Islamic Republic of Afghanistan for the years 2009-2013” prepared by the MFA. The first draft of the Strategy, dated April 23, indicates a 190 million Lt amount. �� “Up to 200 kids said dead of cold in Afghan province”, 24 Feb 2005, http://www.reliefweb.int/rw/rwb. nsf/db900sid/DDAD-69WUA3?OpenDocument&query=Ghor, 14 07 2010. “Hundreds feared dead in Afghanistan’s harshest winter for years”, 04 Mar 2005, http://www.reliefweb.int/rw/rwb.nsf/db900sid/ VBOL-6ABCHS?OpenDocument&query=Ghor, 14 07 2010. 11 “Floods kill over 200 in Afghanistan”, 20 Mar 2005, http://www.reliefweb.int/rw/rwb.nsf/db900sid/ VBOL-6APG87?OpenDocument&query=Ghor, 14 07 2010. 192

The province of Ghor is criss-crossed by mountain rivers that flood in the spring but sink or totally desiccate in the second part of the summer. Though some of them (especially in the north) feed the agricultural fields that are outside the province, it is difficult to effectively use water from the rivers for the needs of the inhabitants of the province. Therefore the problem of drinking-water and water suitable for agricultural use, especially in the summer and early autumn, is very acute. Several- year long droughts at the beginning of the decade have pushed Ghor to a brink of mass famine. A similar situation developed in the summer of 2006.12 Approximately 98 percent of the inhabitants of Ghor are peasants (only about 13-15 thousand of roughly 670 thousand live in the only town in the whole province – in its administrative centre Chaghcharan) who live in some 2,000 villages spread in the area of more than 36 thousand square kilometres. Though cereal plants are most common in agriculture, poppies that used to bring several times higher income than other agricultures were for a time also widely cultivated. However, the locals almost stopped cultivating the opium poppies because of bad yields caused by repeated droughts and because of low wholesale prices and in 2008 it was officially announced that Ghor is an opium poppy-free province of Afghanistan.13 If, before the establishment of the PRT, there was some even if meagre information provided publicly about the natural conditions in Ghor, there virtually was no information or statistics on after effects (victims or damage) of natural disasters, or the condition of the local economy – overall poverty and starvation.14 Using to its advantage the ignorance of the Lithuanian society – there was no previous knowledge about the real situation in Ghor – the Lithuanian government engaged in successful “construction of social reality” and “social construction of knowledge” when through press releases and public speeches by politicians it supplied the society with “processed” (“softened”) information about Ghor aimed at forming among the citizens of the country a favourable or at least not adverse opinion about the kicking-off mission. All the possible risk factors (as a rule identified exclusively with natural conditions) were countered with the argument that Ghor is one of the safest provinces in Afghanistan. But what is most important, is the presumably favourable circumstances and conditions that joining the NATO mission in Afghanistan brought and how it was being presented, not only as the fulfilment of the obligations to NATO,

12 “Christian Aid calls for immediate action and assistance for drought affected population in Afghanistan”, 13 Aug 2006, http://www.reliefweb.int/rw/rwb.nsf/db900sid/KHII-6SR89C?OpenDocument&query=Ghor, 14 07 2010. 13 Mansfield D., “Poppy Free Provinces: A Measure or a Target?”, Water Management, Livestock and the Opium Economy Project, Afghanistan Research and Evaluation Unit, Case Study Series, May 2009, http:// www.areu.org.af/index.php?option=com_docman&Itemid=26&task=doc_download&gid=668, 14 07 2010. 14 Several press releases could be considered as exceptions. For instance. ELTA, “Afganistane nuo šalčio miršta šimtai vaikų”, 2005 m. vasario 24 d., http://www.delfi.lt/archive/article.php?id=6114070, 14 07 2010. BNS, “Afganistane galėjo mirti daugiau kaip 1 tūkst. vaikų”, 2005 m. vasario 18 d., http://www.delfi.lt/ archive/article.php?id=6073385, 14 07 2010. 193 but also as the only possibility to accumulate foreign policy “capital” while practically taking no serious risk. The then Minister of National Defence G. Kirkilas assured that “The Lithuanian leadership of a Provincial reconstruction team in Afghanistan will endow the state with a solid political significance in the NATO context. Lithuania, through actively engaging in the international operations, will be more visible and will attain stronger position.”15 –. Recalling that the political elite of Lithuania in 2004 were actively proceeding with the construction of the image of Lithuania as the leader of the region (though geo- graphically never precisely defined), it becomes even more comprehensible that the mission in Afghanistan had to add to the strengthening of this image. Besides, it was very likely hoped-for by the architects of the mission that an active engagement in NATO activities in Afghanistan would be of great value for Lithuanian – a new (and inexperienced) member of NATO – Armed Forces, which would not only gain the priceless experience of cooperation, as well as action in an armed conflict zone, but would experience the overall transformation, the hugest part of which was and still is the renewal of arma- ments and machinery. Lastly, the army (especially high ranking officers) would have to perform a sort of diplomatic function – to be envoys of Lithuania in a grand international project. And indeed, there were no mistakes made in this sphere – from the publicly available information one can get an impression that the preparedness of and fulfilment of tasks by Lithuanian soldiers (among them the talent to avoid victims) has received a positive evaluation from top NATO officials as well as military chiefs and commanders from individual member-states. In the Lithuanian media there are plenty of citations of both the commends for the Lithuanian soldiers made by foreign generals or other brothers in arm and the local politicians who insistently emphasize this. One can come to the conclusion that the government of Lithuania has succeeded in reaching one of its goals – to create in the eyes of military “allies and partners” an image of Lithuania as an active member of NATO which is fulfilling (or even exceeding) its obligations to the Alliance. Occasionally, the example of Lithuania in the NATO system would be used to embarrass member-states of NATO that have more recourses and forces but contribute less to the activities of ISAF. However, absorbed by this aspect of the image-creating, the governing Social Democrats until the very end of their ruling in 2008 failed to seriously focus on the civil dimension of the mission. The position of the then Minister of National Defence Kirkilas, conveyed by media some time prior to the actual establishment of the PRT, that “assistance from the Alliance members will also be sought in the future in executing various construction works in Afghanistan, such as building of hospitals and paving the roads. The minister hopes that

15 BNS, “Lietuva mini narystės NATO pirmąsias metines”, 2005 m. kovo 29 d., http://www.delfi.lt/archive/ article.php?id=6348015, 14 07 2010. 194

these projects will be implemented specifically out of NATO allies’ funding.”16 This betrays the fact that Lithuania did not even consider seriously engaging in the provincial reconstruction works (in other words, international donations). Kirkilas’ idea of soliciting funds for civilian projects from “allies” shows the then government’s felt (and possibly consciously made) division between the military and civilian dimensions of the Lithuanian mission in Ghor – Lithu- ania since the very inception of the PRT was ready to pull adequate financial and human resources only for the former – and this was later proven by the amounts spent. Since the MND was the most eager institution for Lithuania to join the mission, from its establishment in the summer of 2005 the PRT was and remains in principle a military project, because the civilian component (not including hired service personnel, such as kitchen and laundry workers) has never exceeded 5 percent of the PRT personnel. For the first two years since the establishment of the PRT (especially when Kirkilas became the Prime Minister in the summer of 2006) the MND had practically taken over the diplomatic functions related to Lithuania’s activities in Afghanistan and pushed aside the awkward MFA until its mandate and functions as the coordinating institution were enhanced with the establishment in 2007 of the Development Cooperation and Democracy Promotion Department.

2. The Evolution of the Mission: Between Rhetorical Altruism and Tacit Pragmatism

“Lithuania responded with enthusiasm to the invitation of NATO to lead a new PRT in the Afghan Province of Ghor. I can assure you that you have friends who want to help you.”17 – with such words the then President of Lithuania Valdas Adamkus reassured the Vice President of Afghanistan during their meeting in the autumn of 2005. Soon afterwards, when on a visit to the Li- thuanian-led PRT in Ghor, the President declared that “Lithuania, having quite a lot experience in state-building, understands the need of Afghanistan to build its state. We consider our mission as very important.”18 But the “state-building” Adamkus was referring to is mainly composed of activities of non-military nature (where probably the most important tasks are building the institutions and structures of government, justice and security and strengthening of their capacities and capabilities). Therefore, the Lithuanian-led PRT like the others elsewhere in the country, besides the military dimension that had to ensure se-

16 Aleknaitė K., “Į Afganistaną siunčiamų karių skaičių gali prašyti didinti”, Delfi.lt, 2005 m vasario 21 d., http://www.delfi.lt/archive/article.php?id=6086612, , 14 07 2010. 17 Press service of the President, “V. Adamkus: Lietuva reiškia paramą Afganistano vyriausybės siekiams”, 2005-09-15, http://archyvas.lrp.lt/lt/news.full/5940, 14 07 2010. 18 Sekunde.lt, “Prezidentas pagyrė ir apdovanojo Lietuvos karius”, 2005-10-12, http://www.sekunde.lt/ content.php?p=read&tid=23060, 14 07 2010. 195 cure environment for “state-building”, also had from its inception to embark on civilian (development cooperation) activities that through human and financial resources were to make a direct contribution to the “state-building”. Formally, the civilian dimension of the mission in Ghor was not much behind the military dimension – the Lithuanian Parliament sanctioned the participation of civilians in the mission as early as June of 2005 by creating a Special Mission whose first employees started to work in Ghor in the end of July that same year. The civilian component of the PRT, especially the Special Mission, had to be multifunctional right from its inauguration: on the one hand it had to represent Lithuania in Afghanistan (to serve as a surrogate embassy both in respect to partner-states and the official Kabul as well as in the realm of ISAF), while on the other hand it had to carry out development cooperation projects – to contribute comprehensively to the reconstruction of the province. Lithuania (in the person of the MFA) appointed a Special Lithuanian assistance and project coordinator in Afghanistan on September 8, 2005. The coordinator was charged with supervising “the civilian activities of the Lithuanian-led Ghor PRT in Afghanistan, organizing support for civilian, development and humanitarian projects”19. At the same time, it was reported that the mission of the Ambassador G. Damušis who was appointed the coordinator was to “attract attention and encourage activities in the Province of Ghor of other governmental, international and non-governmental organizations and agencies”. Thus, formally considering, legally and structurally Lithuania from late 2005 was ready for a full-fledged development (e.g. implementation of development cooperation projects) of the civilian dimension of the mission in Ghor. However, real input of the country that proclaimed itself a donor-state hardly met the image being created (and ultimately the expectations of organizations engaged in international donations as well those of the local residents). Firstly so, because the Lithuanian Special Mission since its establishment up to this day (mid-2009) has been staffed by only three or four civil servants from the MND, MFA and the Police Department. As of mid-2009, not any other ministry or state institution had sent any specialists in other fields (like agriculture, health care, education, communications, economy). With such a composition of the Special Mission, the division of functions was hard to realize and the representation function was mixed with the practical (development cooperation). Even worse, due to a constant lack of funding for civilian projects the Spe- cial mission has been engaged in the practice that could be named “diplomatic begging”, when foreign governments, enterprises or international organizations are constantly being beseeched to spare funds for long-term infrastructural and other large scale projects in Ghor. Itself in 2006, Lithuania budgeted 1.14 million Lt for the civilian projects in Afghanistan that had to “improve the

�� Delfi.lt, “G. Damušytė koordinuos Lietuvos projektus Afganistane”, 2005-09-09,http://www.delfi.lt/news/ daily/lithuania/article.php?id=7449807, 14 07 2010. 196

infrastructure of Ghor, delivery of electricity and health services.”20, from this amount “0.3 million Lt -for technical support and training of the Afghan Natio- nal Police (ANP).”21 Considering the fact that the police officers in the province (as elsewhere in the country) lack elementary knowledge and working skills, 100 thousand Euros for the essential equipment and machinery although was vitally necessary was way too small a support for policemen who are in charge of some 36 thousand square km mountainous territory. In the first year of the PRT operation, only very limited funding was attracted from outside because even the USAID had no (more) representation in Ghor and UNAMA still had not opened an office in the province (it was opened only in the summer of 2007). From among the half a dozen of non- governmental organizations operating at the time in the province several (e.g. the French MADERA (Mission d’Aide au Developpement des Economies Rurales) and the American World Vision) had even halted their activities due to a deterioration of the security situation (because of increase in racketeering, threats and even violence against employees of aid organizations). With just a year having passed since the establishment of the PRT, there already were discernible signs that local officials were starting to feel that the PRT was not meeting the expectations of the provincial administration. This was openly reflected by one Lithuanian civil servant who had close relations to the activities of the PRT and who in his memos to the then leadership in the National Defence System lamented that “lately during meetings more and more often we hear reproaches because of meagre financial and material support provided by the PRT for the restoration of the provincial economy. It is claimed that in other provinces such support is considerably larger. In the future, this could have negative impact on providing safety for soldiers.”, and added further that “the CIMIC sections of all the Lithuanian PRTs (rotations – my insertion) were doing their job very well but during the past year they have not received a dollar for their activities. All the charity was received from Denmark and Iceland or bought on personal money of the Lithuanian soldiers. Further the harder it will be for the PRT’s MLOTs (Mobile Liaison Observation Teams) to visit villages in the province, because local residents do not feel any concrete, even if small, support for schools, hospitals, disabled people and so on. One has to “buy” the safety of MLOTs.”22 Finally, by way of concluding he proposed that “the civilian component of the PRT has to be strengthened. The PRT is not a responsibility of the national defence system but an international obligation of Lithuania. (…) in the composition of the planned Lithuanian VIP delegation there should be representatives (desirably, of not lower than the ministry secretary rank) from the Healthcare, Education, Agriculture, Economy,

20 Delfi.lt, “Afganistano atkūrimui Lietuva žada skirti apie 4 mln. Lt”, 2006-11-03,http://www.delfi.lt/news/ daily/lithuania/article.php?id=11121364, 14 07 2010. 21 Lrytas.lt, “Trečdalis Lietuvos paramos Afganistano Goro provincijai teks vietos policijai”, 2006-08-08, http://www.lrytas.lt/-11550360991154176812-tre%C4%8Ddalis-lietuvos-paramos-afganistano-goro-provincijai-teks-vietos-policijai.htm, 14 07 2010. 22 Memo of a National Defense System employee to the NDS leadership, autumn of 2006. 197

Interior and other ministries. The ministries, after having analyzed the situation in the Province of Ghor and assessing their own capabilities, should commission representatives for longer period of times, like in the way it is done by the Ministry of Interior, for the implementation of particular projects.”23 The neglect of the Lithuanian government in the sphere of civilian (later named “development cooperation”) projects was criticized back in the end of 2006 by the head of the 3rd PRT rotation which just had finished its tour of duty, colonel lieutenant Vilmas Šatas. According to him, it was obvious already then that “the resources are needed not only for us but to develop the province too. Our detachments are stationed there, but there is no result whatsoever. Excuse me, the visible result is very paltry.”24 In public, on the contrary, a picture of social and economic growth in the province was being painted by politicians and top civil servants: “I was there twice. I witnessed how the living conditions are changing. Support has been given to the school, the local hospital. First light-bulbs will be switched on in villages. I think it is a solid support”,25 - this is what one of the godfathers of the mission and the then Minister of National Defence J. Olekas claimed at the end of 2006. The Ministry he was heading at the time was preoccupied with the regular release into circulation of messages with “humanitarian” content. For instance, in 2006-2007, the MND, and to a certain extent the MFA, would broadcast widely press releases on transmission of some materials (furniture, office commodities, clothes, small equipment and machinery) or organizing of repair services for the local children’s home, hospital or other public institutions.26 By means of this kind of public relations messages both a picture of the province under reconstruction and an image of the main organizer of that reconstruction – Lithuania as a diligent and generous donor – were painstakingly being created in the eyes of the society by both ministries. Indeed, until 2007, when the “Commission of development cooperation and democracy promotion programs and projects”27 was created by a decree of the Minister of Foreign Affairs soon to be followed by establishment of the

23 Ibid. 24 Masilionis R., “Valdžia nesugeba išspręsti paramos Afganistanui klausimo”, Panorama, 2006 m. lapkričio 25 d., http://www.delfi.lt/archive/article.php?id=11331722, 14 07 2010. 25 Ibid. �� Ministry of National Defense, “Čagčarano mergaičių mokyklai – pagalvės ir šildytuvas”, 2006-12-04, http:// senas.kam.lt/index.php/lt/117826/, 14 07 2010; “Koranas ir kilimai mečetėms – dar vienas greitojo poveikio projektas Goro provincijoje”, 2006-11-13, http://senas.kam.lt/index.php/lt/116321/, 14 07 2010;”Lietuvos kariai padeda Afganistano Goro provincijos našlaičiams pasirengti žiemai”, 2007-10-23, http://senas.kam.lt/index.php/ lt/141879/, 14 07 2010; “Afganistane Lietuvos karių iniciatyva rekonstruotas vaikų globos namų kambarys” 2006-11-28, http://senas.kam.lt/index.php/lt/117184/, 14 07 2010; “Lietuvos kariai padeda kompiuterizuoti Goro provincijos valdžios institucijas”, 2007-08-01, http://senas.kam.lt/index.php/lt/136742/, , 14 07 2010. 27 Development Cooperation and Democracy Promotion Department of the MFA, “Bendroji informacija”, http://www.orangeprojects.lt/site/?page=10, 14 07 2010.. On the website, among other things it is stated that “The goals of the Lithuanian Development Cooperation Policy are to contribute to the development of democracy, security, and stability in the neighbouring regions; to promote political, cultural, economic, and social relationship with the countries in the region; and to increase the role of Lithuania in shaping and implementing the policy of the international organisations in the region, and, therefore, to strengthen Lithuania’s national security.” 198

Development Cooperation and Democracy Promotion Department, entrusted with implementation of civilian projects in Ghor, the civilian component of the PRT was in the place of a stepdaughter to the military contingent and could not (was not able to) pursue any significant long-term development cooperation activities. The year 2007 could be considered as the breakthrough year – Lithu- ania increased threefold the resources allocated for development cooperation projects: in 2007, 25 of such projects worth 3.6 million Lt were underway in Afghanistan and in 2008 – the year of boom – 4 million Lt were spent for a record high number (36) development cooperation projects in Afghanistan. The grand total spent for civilian projects in 2006-2008 – around 8.7 million Lt. In the four years since the establishment of the PRT (2009 including) Lithuania assigned 11.7 million Lt (about 3.5 million Euros) for the development cooperation projects in Afghanistan. In comparison, Estonia and Latvia which do not have their own PRTs committed respectively 400 thousand and not less than 170 thousand Euros for the development cooperation projects in Afghanistan in 2007-2009. Also Poland, which has no PRT either, allotted 8.5 million Zlotys (about 2 million Euros) in just 2008. The official financial statistics of the MFA on development cooperation projects do not distinguish between those projects the funds for which are appropriated in Afghanistan and by Afghans (ideally in Ghor) and those the funds for which stay in Lithuania and go to the accounts of Lithuanian enterprises, organizations and individuals. In other words, the official statistics do not reveal what share of allocated funds remains in Lithuania (or what goes to third parties, for example, for logistical services) and does not reach the Afghans. Looking through the list of approved projects for the past four years (including 2009) one can make out several project categories, funds for which either do not leave Lithuania or are received by Lithuanian citizens. Among such categories are “Strengthening of cultural relations and protection of cultural heritage” and “Public awareness” projects. The projects of these two categories, especially of the second, are invoked for the creation both inside and abroad of an image of Lithuania as a capable and successful donor-state. In 2007, there was only one project that fell into the category of “Strengt- hening of cultural relations, protection of cultural heritage” – an archaeological expedition that cost Lithuania 62.35 thousand Lt while the two projects in the category of “Public awareness” cost 53.40 thousand Lt. In 2008, already 385 thousand Lt were given for five projects in the category of “Strengthening of cultural relations, protection of cultural heritage” out of which 210 thousand Lt – for a repeated archaeological expedition while 50 thousand Lt were spent on publishing of Lithuanian fairy-tales translated into Dari language. “Public awareness” projects (4) that year fetched 146 thousand Lt, whereof 2 projects (with the total value of 31 thousand Lt) – for promotion and advertising of the aforementioned archaeological expedition. In this manner, in two years (2007-2008) out of 7.6 million Lt allocated to development cooperation, projects of the two categories received almost 650 thousand Lt (8,5 % of all projects’ value) with the bulk of money going to Lithuanian enterprises, organizations 199 and individuals. Among the 13 approved projects (total value – 2 million Lt) for 2009 two are of “Strengthening of cultural relations, protection of cultural heritage” (a third archaeological expedition and continuation of the publishing of Lithuanian fairy-tales in Dari language) and another two of “Public awareness” category (besides the continuous28 “Look – Afghanistan is near. Help – you can”, a one-off National TV (LRT) project “Afghanistan: the presidential elections – a test for Lithuania as well”). “Visibility” of Lithuania is almost a keyword defining not only the projects of development cooperation in Ghor that fall into the category of “Public awareness”. Most of the other projects, such as those related to infrastructure building, or provision of equipment (for the hospital, police, local authorities) or even training are seen by Lithuanian officials (first of all in the person of civil servants at the Development Cooperation and De- mocracy Promotion Department of the MFA) through the prism of a public relations campaign – Lithuania should be visible as much as possible in all the projects financed by Lithuania. Those projects which do not show material (physically visible) results are shunned. So, for example, the MFA is reported to have refused to finance the vaccination of life stock of residents of Ghor, because, as a former head of the Special Mission ironically remarked, “you would not paint the Lithuanian flag on a sheep”. Thus the construction of “social reality” and “social construction of knowledge” were started being applied not only vis-à-vis the allies and partners who had become the surrogate target group and the Lithuanian society but on residents of Ghor as well (who had also to start believing not only in since- rity of Lithuanian intentions to support reconstruction of the province but in its actual industriousness too). In any case, the allocated two and a half million Euros over three years (2006-2008) could not have had any significant even temporal support for the inhabitants of the province because any keen observer of the situation in Ghor knows that Ghor is the poorest province in Afghanistan, inhabitants of which suffer chronically from lack of necessary alimentary products and fuel for co- oking and heating. For example, in October of 2007 a joint USAID, WFP and a few NGOs investigation revealed that up to 45% of Ghor residents (from the estimated 635,302) were in acute need of food assistance – they needed more than 14 thousand metric tons of various foodstuffs.29 It was announced in May of 2008 that more than 110 thousand residents of Ghor were in acute need of food assistance again and to avoid the humanitarian crisis 1,733 metric tons of food were needed to be distributed.30 Even though a bulk of necessary food was finally distributed through the efforts of international and non-governmental

28 Pečeliūnaitė L., “Parama Afganistanui – vieno žmogaus rankose”, Alfa.lt, 2009-02-18. 29 “Afghanistan: One month to avert mass displacement in Ghor”, 23 Oct 2007, http://www.reliefweb.int/ rw/rwb.nsf/db900sid/LRON-789BYA?OpenDocument&query=Ghor, 14 07 2010. 30 “Afghanistan: Food aid appeal for some 100,000 in Ghor Provinc”, 19 May 2008, http://www.reliefweb. int/rw/rwb.nsf/db900sid/YSAR-7ESL79?OpenDocument&query=Ghor, 14 07 2010. 200

organizations, contribution of Lithuania to the appeasement of the situation, sadly, was minimal (in February of 2008, the PRT allocated only 6 tons of food for the Chaghcharan residents) and limited mostly to logistics.31 But most important is the fact that when a great part of the inhabitants of Ghor were on the verge of famine the MND and the MFA, instead the elucidation of the real situation, on their websites and through media were posting messages to the society about one or another small humanitarian support action – distribution of pullovers, wraps and the like32, without even mentioning the measure of the problem. After comparing press releases of international aid organizations and Lithuanian state institutions, one might get an impression that the talk is about two different geographical regions. Since there are no doubts that both the PRT and the government of Lithuania had comprehensive information about the chronic humanitarian crisis in the province, avoidance to inform the Lithuanian society could be regarded as a part of the public relations and image creation campaign where the adverse or compromising information was intentionally blocked in order to conceal the helplessness of Lithuania in the face of this crisis. However, finally in 2008 the seriousness of the situation into which Lithuania had gotten into was realized and the godfather of the mission G. Kirkilas started to speak with more caution about the course and the success of it. According to media, in a meeting in July of 2008 “with the USA vice-president Dick Cheney, the premier Gediminas Kirkilas told him that Lithuania is ready to fulfil the obligations, but additional financial and military support was necessary for the Lithuanian reconstruction mission in the province of Ghor in Afghanistan.”33 This rhetoric of Kirkilas might have in part been impelled by seasonal difficulties: harsh winter of 2008, followed disastrous spring floods and summer drought but also by realization that the security situation in the province is out of control – something that was pointedly shown by a worthless loss of a Lithuanian soldier during the siege in May of 2008 at the PRT camp.

3. A New Beginning?

At the end of 2008, with the change of the government and with steadily worsening economic situation in the country, Lithuania (first of all, in the person of the ruling coalition) began to re-evaluate its obligations in Afghanistan. The advisor to the Minister of National Defence Dainius Žalimas evaluated the decision of the then Lithuanian government (run by Social Democrats) to

31 Ministry of National Defense, “Goro provincijos sostinėje Čagčarane PAG-6 kariai vietiniams gyventojams dalijo maistą”, 2008-02-11, http://senas.kam.lt/index.php/lt/148134/, 14 07 2010. 32 Ministry of National Defense, “Afganistane kariai padeda vietos gyventojams kovoti su žiemos sunkuma”, 2008-01-18, http://senas.kam.lt/index.php/lt/146044/, 14 07 2010. 33 Delfi.lt., “G. Kirkilas: misijai Afganistane reikia papildomos paramos”, 2008 m. liepos 3 d., http://www. delfi.lt/archive/article.php?id=17608225, 14 07 2010. 201 take on the responsibility for the establishment and leading of a PRT bluntly but correctly: “It was a political decision, made, maybe, with the aim of being the first to score. One could discuss for long why Lithuania sticks out in its peculiar way compared with other Baltic States. Maybe, because of its statehood traditions, maybe, because of the perception of its own role, which does not correspond to the possibilities and the size of the state. (…) It is difficult to say, if Lithuania can play its role any further.”34 In 2009, with the increased attention of the politicians for the participation of Lithuania in the NATO mission in Afghanistan, the distinction between the two dimensions of the mission – the military (that corresponds to the fulfilment of the obligations to NATO) and the civilian (that corresponds to the carrying out of the donor-state role) resurfaced once again. According to the Minister of National Defence Rasa Juknevičienė, “in the military sphere, we are doing everything right. The biggest problem – to help the local government of the developing province of Ghor to pave roads, build schools, improve health care, take care of infrastructure: plumbing and electricity. This proceeds with difficulties. We have attained very little from this point of view.”35 Around the same time, President Adamkus openly expressed his (and Lithuania’s) wish: “We would like the donor-states to share (their resources – my insertion) with us in NATO missions, because their financial capabilities are much better than Lithuania’s. (…) This is a moral question and a question of solidarity”.36 One can discern from the sayings of the Minister and other top state officials that the Lithuanian Government is satisfied with the military dimension of the mission in Afghanistan and the concern is raised only because of the possible reduction in funding in the future. On the contrary, there are a lot of discussions about the civilian dimension of the mission. Members of the government and MPs from the ruling parties notably critically met the intended reduction of the funding for development cooperation projects from the previous 4 million Lt in 2008 to the suggested 2 million Lt in 2009. After the opposition from of the chairman of the Parliamentary National Security and Defence Committee conservative A. Anušauskas and other influential politicians, funding for civilian projects for 2009 was set at a halfway amount of 3 million Lt (in fact, only 2 million were distributed according to the data as of November 2009) even though some of the MPs from the governing parties (for instance, a member of the Parliamentary Foreign Affairs Committee Saulius Stoma) thought that “the civilian projects require the same amount of money as it is needed for sustaining the military part of our mission” (not less than 40 million Lt per year).37

�� Laučius V., “Penkmetis Aljanse: patirtis ir iššūkia”, Lietuvos žinios, 2009 m. kovo 28d., http://www.15min. lt/naujiena/spausdinti/aktualu/lietuva/56/34328/, 14 07 2010. 35 Ibid. 36 Delfi.lt, Lietuva norėtų perskirstyti Afganistano “krepšelį”, 2009-04-03, http://www.delfi.lt/news/daily/ lithuania/article.php?id=21318207&l=fplead, 14 07 2010. 37 Samoškaitė E., “Lietuva karštligiškai ieško pinigų Afganistanui”, Delfi.lt, 2009 m. birželio 10 d., http:// www.delfi.lt/news/daily/lithuania/article.php?id=22578001, 14 07 2010. 202

Simultaneously, the ruling parties indirectly criticized the neglect of the previous government and its subordinate institutions (especially the MFA) in safeguarding the efficiency of the civilian dimension of the mission in Afg- hanistan. The Minister of National Defence declared that “Lithuania cannot provide as much money as it would be necessary. Even in the years of economic growth very little financial resources were being allocated compared with what was being given to those provinces that are administered by richer states. I am afraid that in time it could become an instability factor. (…) This is a headache for our MFA – it manages the money designated for Afghanistan. We need to search for ways out, first of all – to look for donor-states.”38 Incapability to enlist donors is nearly the most galling fact in the work related to Lithuania’s commitments in Afghanistan, of the MFA as the institution coordinating the civilian dimension of the mission in Ghor. This was discussed in a joint session of the Parliamentary Foreign Affairs and National Security and Defence Committees in June of 2009 during which, according to media, “parliamentarians (…) raised the question about the fruits of the activities of the diplomats. According to the chairman of the Foreign Affairs Committee A. Ažubalis, some of the parliamentarians had doubts if the Lithuanian diplomats did everything to make other states join the reconstruction of the province of Ghor.”39 And if to the former Minister of Foreign Affairs Petras Vaitiekūnas Afghanistan was not a priority direction of the Lithuanian foreign policy (he had effectively delegated the responsibility to civil servants of the Special Mission and at the Development Cooperation and Democracy Promotion Department) then his successor in the minister’s chair Vygaudas Ušackas is active himself in this field. As media has reported, “underlying the importance of international support for remote and less developed regions like the province of Ghor in which Lithuania leads one of the provincial reconstruction teams, V. Ušackas suggested establishing of a special development fund for the country which would guarantee more even and efficient distribution of the international donor resources in Afghanistan.”40 In order to improve the unfavourable situation, the Parliamentary Fo- reign Affairs and National Security and Defence Committees in the spring of 2009 “having listened to the information of interested governmental institutions and taking into consideration the decreasing financing which may have a direct impact on the safety of Lithuanian citizens working in Afghanistan, proposes for the Government of the Republic of Lithuania to prepare and submit by June 1 to the Committees a complex military and civilian strategy of the activities of the

38 Laučius V., “Penkmetis Aljanse: patirtis ir iššūkia”, Lietuvos žinios, 2009 m. kovo 28 d., http://www.15min.lt/naujiena/spausdinti/aktualu/lietuva/56/34328/, 14 07 2010. 39 Samoškaitė E., “Lietuva karštligiškai ieško pinigų Afganistanui”, Delfi.lt, 2009 m. birželio 10 d., http:// www.delfi.lt/news/daily/lithuania/article.php?id=22578001, 14 07 2010. 40 BNS, “Ušackas: misija Afganistane būtų efektyvesnė, jei būtų aiški veikimo strategija”, 2009-04-05, http:// www.alfa.lt/straipsnis/10267257/?Usackas..misija.Afganistane.butu.efektyvesne..jei.butu.aiski.veikimo. strategija=2009-04-05_19-14, 14 07 2010. 203

Republic of Lithuania in the Islamic Republic of Afghanistan.”41 For the sake of fairness, one has to point out that the need for such a strategy was felt already by the Foreign Affairs Committee of the Parliament of the previous term, when in one of its meetings “it was emphasized that it is necessary to strengthen the civilian component of the mission, to pay more attention to solving humanitarian, and social welfare problems by more actively involving other states in the planning and execution of civilian projects in the Province of Ghor, Afghanistan. The Committee will propose for the Government to discuss the question of a further strategy of the international mission in Afghanistan.”42 However, back then there were no further steps taken beyond the expressed wish ultimately leaving the initiative to the Parliament of the new term and the government of new composition (as it turned out, without the Social Democrats). On August 19, 2009, after four and a half months in preparation and active discussions and adjustments by various institutions, the government of Lithuania finally endorsed the “Strategy of the participation of the Republic of Lithuania in the activities of the international community in the Islamic Republic of Afghanistan for the years 2009-2013”, the purpose of which is to “set[s] out objectives, tasks, principles, and measures for Lithuania’s effective and successful engagement in Afghanistan stemming from Lithuania’s international commitments. The Strategy outlines Lithuania’s contribution in Afghanistan in the context of Joint Engagement Strategies of NATO, the EU, the US, and other allies and reflects Lithuania’s realistic potential to contribute to the efforts of the international community and the Government of Afghanistan aimed at the restoration of peace, security, and stability, and facilitation of sustainable development.” (English translation provided by the MFA)43. The Strategy, before gaining its current form which was endorsed by the government, had at least a couple of earlier crucially different drafts. The early draft-project dated April 23, 2009 “Civilian-military strategy of the activities of the Republic of Lithuania in the Islamic Republic of Afghanistan for the years 2009-2013” prepared by the Transatlantic Cooperation and Security Policy Department of the MFA was very emotional. It was permeated by the feeling that if the Lithuanian mission in Ghor is not yet doomed to fail, without a solid financial boost to the civilian dimension (to finance large-scale development cooperation projects), it will inevitably face difficulties and threats which will lead Lithuania to “consider the possibility of looking for other ways to

41Press release of the Parliamentary National Security and Defense Committee, “Turi būti tęsiamas civilinių projektų finansavimas Afganistano Goro provincijoje”, April 8, 2009,http://www3.lrs.lt/pls/inter/ w5_show?p_r=6242&p_d=85898&p_k=1, 14 07 2010. 42 Press release of the Parliamentary National Security and Defense Committee “Komitetas išklausė Krašto apsaugos ministro informaciją dėl situacijos tarptautinėse operacijose”, July 9, 2008, http://www3.lrs.lt/ docs2/RHIGNGDF.DOC, 14 07 2010. 43 Lietuvos Respublikos Vyriausybė, “Dėl Lietuvos Respublikos dalyvavimo tarptautinės bendruomenės veikloje Afganistano Islamo Respublikoje 2009–2013 metų strategijos patvirtinimo”, 2009-08-19, http://www.lrvk.lt/lt/teises-aktai/priimti-teises-aktai?a=Nutarimas&an=&df=2009-08-19&dt=2009-08- 19&ot=0&q=Afganistano, 14 07 2010. 204

participate in the ISAF operation partly or fully transferring its leadership of the PRT in the province of Ghor to another ally”.44 In the nine formulated risk factors, the funding of the mission is directly associated with the success of the mission while only superficial attention is given to the military (security) dimension without taking seriously into consideration the progressive decline of the security situation both in all of the country and in particular Ghor. Another important aspect of the initial project is the dominating belief that the Lithuanian mission in Ghor is inseparable from the creation of Lithuania’s image. In describing the strategic goals of Lithuanian activities in Afghanistan one of the two stated goals in the project was “to consolidate the status of Lithuania as an active, reliable, responsible member of the international community. Seeking to achieve this goal Lithuania has to actively participate in the development cooperation and donation activities.” The aspiration “to establish Lithuania as a reliable and strong NATO member”45 is indicated as one of the objectives. And “seeking to assure the support of the Lithuanian society and politicians for the Lithuanian actions in Afghanistan, a communicative strategy is needed, which would include information dissemination and public relations activities both in Lithuania and in Afghanistan as well as broadcasting the news abroad about the work of Lithuania”, in which the most important accent should be stressing “the stories of success”. The project was finished with a warning that “if the goals of the Lithuanian mission in Afghanistan were not reached, the province of Ghor could become uncontrollable and this would make a negative impact on the success of the entire ISAF operation. In such a case trust in Lithuanian capability to participate in international operations would be shaken and a huge harm would be done to the international image of Lithuania as a reliable partner.” The initial draft reflected the spirit of the Lithuanian activities in Afgha- nistan in 2006-2008 – through the construction of “social reality” and “social construction of knowledge” to create to all – the “partners” and allies, the Lithu- anian society and the target group – the inhabitants of Ghor – an impression of Lithuanian activeness (especially in the donations and development cooperation field) which in its turn had to serve for an improvement of the Lithuanian image and prestige. One can indirectly understand from the project that the target audience of the Lithuanian mission is the US Government – “the participation of Lithuania in the international operation in Afghanistan is an essential aspect of Lithuanian participation in NATO activities and the relationships with the USA.” 46 In a later draft named the “Strategy of the activities of the Republic of Lithuania in the Islamic Republic of Afghanistan for the years 2009-2013” which became the basis for the Strategy’s edition endorsed by the government, the

44 “Lietuvos Respublikos veiklos Afganistano Islamo Respublikoje civilinė-karinė strategija 2009 – 2013 metams”, Project, MFA, 2009-04-23. 45 Ibid. 46 Ibid. 205 emotionality was changed within the style and content of dry bureaucratic language. Taking into consideration the comments of the members of the Par- liamentary Foreign Affairs and National Security and Defence Committees, the draft was twice amended and refined by the MFA. In the endorsed “Strategy of the participation of the Republic of Lithu- ania in the activities of the international community in the Islamic Republic of Afghanistan for the years 2009-2013”47 the creating of Lithuania’s image was practically eliminated. Still, there is a separate section in the Strategy devoted to “Communications and Public Relations” through which “an emphasis on the positive aspects and results” should be put for the Lithuanian society, the allies and partners, the international organizations, donors, the society of Afg- hanistan and especially its government. Among the desired “results of Strategy implementation” is a following one: “Favourable opinion of Lithuania’s public and the majority of politicians on Lithuania’s activities in Afghanistan”. It is stated in the Strategy that “The first objective of Lithuania as an active and committed member of the international community is to ensure the national security and security of its allies, enhance NATO’s credibility, and contribute towards ensuring regional and global security and stability.”, while “to contribute to the international efforts to reconstruct the state of Afghanistan, ensure stable and consistent development of its economy and infrastructure, improve living conditions for its inhabitants, and promote the rule of law, good governance, and respect for human rights.” is relegated the status of secondary objective. If the prioritization of the Lithuanian objectives in the Strategy was intentional (and it is plausible to believe so), one can come to the conclusion that the hypothesis is the Lithuanian government had displaced the target groups is verified – Afghans indeed stayed behind only as a secondary group while their place was taken up by NATO allies and partners. When evaluating the entire text of the Strategy one can make a conclusion that an attempt to verbalize raison d’être of the Lithuanian mission was, though very belated, nevertheless necessary. However, the achieved result is to be considered with caution – there is too little assessment of the wider context and tendencies, and there is too much concentration on describing the status quo and specific racketeering of the government in order to ascertain greater funding otherwise warning that the mission would collapse. Finally, the pessimistic tone of the Strategy makes an impression that its authors did not believe anymore in the success of the Lithuanian mission whether it be the creation of Lithuania’s image and prestige, or the improvement of living standards for the residents of Ghor.

47 Lietuvos Respublikos Vyriausybė, “Dėl Lietuvos Respublikos dalyvavimo tarptautinės bendruomenės veikloje Afganistano Islamo Respublikoje 2009–2013 metų strategijos patvirtinimo”, 2009-08-19, http://www.lrvk.lt/lt/teises-aktai/priimti-teises-aktai?a=Nutarimas&an=&df=2009-08-19&dt=2009-08- 19&ot=0&q=Afganistano, 14 07 2010. 206 Conclusion

The participation of Lithuania in the NATO mission up to now is twofold and controversial: being basically of a pragmatic character (giving the preferen- ce to the “allies and partners” as the (surrogate) target group and ignoring the expectations of the original primary target group (residents of the province)) it is only covered with the veil of altruism (utilizing the construction of “social reality” and “social construction of knowledge” and purposely disorientating Lithuanian citizens (the audience)). In the long run such an approach could be disastrous: the mere imitation of Lithuanian activeness will not satisfy the international partners (like aid organizations) who operate on the altruistic grounds and will also turn the residents of Ghor whose expectations are not met either, against Lithuania. This will inevitably determine the decline of the image of a reliable, able and responsible state among partners and in Afgha- nistan itself (pragmatic goals of the participation in the mission will be lost) and the rising discontent will determine a growing danger for the safety of the Lithuanian citizens and the citizens of the partner-states working in the PRT (thus preventing from the possible reaching of idealistic goals). Finally Lithuania will have to withdraw from the mission shamefully (and possibly with losses). In the government-endorsed “Strategy of the participation of the Repu- blic of Lithuania in the activities of the international community in the Islamic Republic of Afghanistan for the years 2009-2013” it is intended to forestall this eventuality, especially through warnings, admitting one’s own limitations but also through indirect accusations levelled against the “allies and partners” for presumed letting down – not contributing enough resources to the reconstruction of Ghor. In other words, the government by endorsing the current edition of the Strategy sought to insure itself against the possible failure of the mission (possibly encoded already in the decisions made by the government of Social Democrats) and publicly envisaged a possibility to make even the most radical decisions, among them withdrawal from the PRT (but not the participation in the NATO mission in general). After responsibly and critically evaluating the evolving situation, the government of Lithuania should start treating the Lithuanian participation in the NATO mission in Afghanistan not as an “image creation” but rather as a “face-saving” and should undertake adequate measures. The anticipated (in six months from the endorsement of the Strategy) “Plan of measures for the implementation of the Strategy” will show which way Lithuania is intended to truly move – to continue, out of inertia, with the dangerous inactiveness covered by idealistic rhetorical figures or to take immediate steps in pre-empting painful outcomes both on the physical (for the Lithuanian soldiers and civil servants of the Special Mission) and spiritual (for the decent name of Lithuania among the “allies and partners”) levels. No matter how the Lithuanian mission in Afghanistan proceeds (at this moment, there are very little circumstances and conditions for it to proceed 207 successfully), it is already evident that Lithuania has become the victim of its own ambitions (desire to create an image of an active subject in international relations), immaturity (failure to assess the „on the ground “ situation that requires cultural literacy and its own capabilities and resources) and circumstances (terrible climate and social conditions in the province of Ghor, decline in security conditions in entire Afghanistan). STRATEGIC RESEARCH CENTER of the Military Academy of Lithuania and Institute of International Relations and Political Science of the University of Vilnius

LITHUANIAN ANNUAL STRATEGIC REVIEW 2009–2010

Signed for printing 17 12 2010. Circulation – 224 copies. Order GL-141 SS. Published by the Military Academy of Lithuania Šilo 5a, LT-10322 Vilnius, Lithuania, http://www.lka.lt Designed and published by Information Provision Service of the General Affairs Department of the Ministry of National Defence, Totorių str. 25/3, LT-01121 Vilnius www.kam.lt Printed by the Lithuanian Armed Forces Military Cartography Centre, Muitinės Str. 4, Domeikava. LT-54359 Kauno Distr.

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