Russia of Challenges Ministry of Defence FINLAND Eteläinen Makasiinikatu 8 PL 31, 00131 HELSINKI www.defmin.fi Layout: Tiina Takala / Ministry of Defence Translation: R&J Language Service Print: Edita Prima Oy, 2008 Cover photo: Lehtikuva ISBN: 978-951-25-1951-4 FEARS Fears are passing away in Russia. Spectres of bygone days like babushkas in some church vestibules begging for bread. I remember when still in their prime they dwelled in the court of Lie, celebrating its victory. Fears, skulking like shadows, penetrated every strata. Little by little they oppressed everyone leaving their mark on everything: when people should have been silent they made them scream, when screams were called for they were muffled. It all feels so distant today. And it feels strange even to reflect on the furtive fear of denunciation, the secret terror when someone knocked at the door. What, then, about the fear of talking to a foreigner? Or, alas, even to your wife? Yea, the unlimited fear of being left abandoned, alone with silence after the parade. We were not afraid of building in a blizzard, nor did we shirk from combat in a hail of bullets, yet, sometimes we had a mortal fear of facing ourselves. Still, we were never conquered or corrupted and Russia, having shed its fears, for good reason and, for now, does instil growing fear among its enemies. I wish all men were overcome by the fear of passing a sentence without a fair trial; the fear of humbling the idea to a lie; the fear of exalting oneself with a lie; the fear of leaving a tortured soul without compassion, and the greatest of all fear: of being afraid while standing at an easel or drawing board. As I myself compose these lines and, now and then unnoticeably hasten, I am driven onwards by my only fear: that I do not pen them with all my might. Jevgeni Jevtushenko 1 Table of contents Preamble ...........................................................................................3 1. Introduction .................................................................................5 2. Society .........................................................................................9 3. Domestic policy .......................................................................... 32 4. Economy and transport ..............................................................54 5. The environment ........................................................................70 6. Energy ........................................................................................87 7. Foreign and security policy ...................................................... 107 8. Summing up .............................................................................124 9. Potential “sore points” in Finnish-Russian relations ................ 137 RUSSIA Land boundaries: Norway, Finland, Estonia, Latvia, Lithuania (Kaliningrad), Poland (Kaliningrad), Belarus, Ukraine, Georgia, Azerbaijan, Kazakhstan, China, Mongolia and North Korea. Area: 17 075 400 square kilometres Population (2007): 142, 2 million, 73 % of whom are urban dwellers Growth rate (2007): 11/ 1 000 inhabitants Death rate (2007): 16/ 1 000 inhabitants Life expectancy (2007): Male: 59 years, Female: 73 years Gender ratio (2007): 0.8 male(s) / female Ethnic groups (2002)1): Russian 79.8 %, Tatar 3.8 %, Ukrainian 2.0 %, Chuvash 1.1 %, Chechen 0.9 %, Armenian 0.9 %, other or unspecified 10.3 % Religions (2002): Russian Orthodox 60 %, Muslim 10-15 %, New religious affiliations 1-4 %, Protestant 1 %, Roman Catholic 1 %, Old Believers 1 %, Buddhist 0,5-1 %, Jewish 0.01 %, Atheist 5-30 % Literacy: 99,4% Languages (2002): Russian 142.6 million, English 7.0 mn, Tatar 5.3 mn, German 2.9 mn, Ukrainian 1.8 mn, Bashkirian 1.4 mn, Chechnyan 1.3 mn, Chuvashian 1.3 mn, Armenian 0.9 mn, Finnish 51 000 GDP/per capita (2007) $12 100 GDP growth rate (2007): 8,1% Foreign exchange reserves (2007): $476. 4 billion (including gold reserves) Economic growth rate: 7 % (on average) since 1988 Average monthly income (2007): $550 Unemployment rate (2007): 6,1% Income tax: Flat rate tax 13 % Sources: CIA, The European Commission Delegation Moscow, World Bank, Russian census 2002, BOFIT Russia statis-tics, GKS - Goskomstat – Russian State Committee for Statistics 1) The most recent census in Russia was conducted in 2002. It remains the official and most comprehensive set of statistics of the nationalities, languages and religions in Russia. 2 Preamble Russia of Challenges In 2007 the Ministry of Defence conducted the research project Stable Russia – an evalu- ation of the security situation in Finland’s neighbourhood. The goal of the project was to paint an all-round picture of the factors affecting stability in Russia as well as possible desta- bilizing developments which could alter the security situation close to the Finnish borders. The project comprehensively tapped into Finnish Russia-expertise. This publication is based on the reports written for that project. As part of the Government the defence establishment is responsible for defence policy, military defence and coordination of total defence arrangements as well as participation in international crisis management. These activities take place in the prevailing security envi- ronment which is monitored and studied. Moreover, its effects on our national security must continually be evaluated. Traditionally, the defence establishment has primarily been interested in our neighbour’s defence and security policy as well as its armed forces. This kind of research is carried out by the Defence Forces. Security, of course, entails other things as well. Furthermore, Finland’s political leaders emphasize the broadness and com-prehensiveness of security. Russia is the single most important factor regarding the security of Finland’s near environs and Russia’s stability has a major impact on our security. It is important to compile a comprehensive pic- ture of the factors and phe-nomena in Russia which are relevant from this viewpoint. The model by which the Stable Russia project was implemented was new. The project defined the following topics relevant to the security environment: Russian society, domestic policy, economy and transport, the environment, energy and foreign policy. A “theme team” including 4-7 experts, one being the team writer, was assigned to each topic. Experts were selected on the basis of availability, albeit with great care. The teams included seasoned Russia-hands as well as keen, young researchers, principally from the academic community and state administration. The teams convened 2-5 times, followed by the team writers compiling their reports. The reports included opinions and empirical knowledge of factors involving Russia’s stabil- ity as well as potentially destabilizing phenomena. The defence establishment can use the reports as such because they contain many noteworthy indicators which can be utilized in strategic planning and as part of the Government’s foreign and security policy reporting process. Due to the stimulating subject matter and the extensive expertise of the teams a deci- sion was taken to edit the reports for the purpose of publishing them. Researcher Hanna Smith from the Aleksanteri Institute of the University of Helsinki was selected for this task. She was responsible for the content of the publication based on the reports and the given editorial task. 3 Neither the editing process nor the work of the teams was altogether simple. When ex- perts get together it is often challenging to transform their knowledge and opinions into a joint assessment. The broad tasking and the multifariousness of Russia repre-sented further challenges. Although this publication may not be exhaustive or conclu-sive, it is certainly en- grossing. The honing of information and expertise on Russia will continue, including further research questions from the defence establishment. We are grateful to all the experts who participated in this project. We also present our heartfelt thanks for the good cooperation and patience given us as we improved the utili- zation of the Finnish Russia-expertise in the Ministry of Defence. Theme teams: Society Team writer: Meri Kulmala Markku Kangaspuro, Markku Kivinen, Mikko Vienonen and Ilkka Vohlonen Domestic policy Team writer: Christian Jokinen Pekka Kauppala, Arto Luukkanen and Ilmari Susiluoto Economy and transport Team writer: Katri Pynnöniemi Kari Liuhto, Jouko Rautava, Sampsa Saralehto and Marjukka Vihavainen-Pitkänen The environment Team writer: Veli-Pekka Tynkkynen Henna Haapala, Kristiina Isokallio, Heikki Reponen and Hanna Uusitalo Energy Team writer: Piia Nikula Timo Hellenberg, Mikko Palonkorpi and Jouko Varjonen as well as Matti Anttonen as com- mentator Foreign policy Team writer: Sinikukka Saari Tuomas Forsberg, Hiski Haukkala, Pia Nordberg and Hanna Smith Enjoy your reading! 4 1. Introduction Hanna Smith “Russia is like a dinosaur. A lot of time is needed for change to reach the tail from the head.” — Alexander Lebed, Trud, 1995. The most important task of a state is to guarantee internal and external security. A state’s security challenges can be categorized, for example, as hard, soft or psychological chal- lenges. Hard security can be construed as the state’s ability to defend its independence against the armed aggression of another state. Foreign, security and defence policies have traditionally served the interests of hard security. The themes of soft security are of- ten mainly linked to globalization. They typically include themes such as the environment, energy,