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In Nord Stream 2 fight, Ukraine gives EU taste of its own bureaucracy

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It was a bold, bureaucratic retort to a geopolitical provocation that would make the wonkiest, most wizened Brussels civil servant proud: After the U.S. and Germany announced a deal last week on Russia’s controversial Nord Stream 2 gas project, Ukraine yanked out its 2,135-page Association Agreement with the EU, and invoked two provisions to demand urgent consultations with the European Commission and the German government.

Theoretically, such discussions would give Ukraine a forum to insist on sanctions to prevent the pipeline from ever operating, or to demand higher financial compensation than Washington and Berlin have offered, along with stricter guarantees.

From a legal and practical standpoint, the move seems unlikely to achieve Ukraine’s goal of killing the Nord Stream 2 pipeline, which would carry natural gas from Russia to Germany, bypassing former routes through Ukraine. But from a political standpoint, senior EU officials and diplomats said that it marked a threshold moment: A partner nation with hopes of one day joining the EU finally had the chutzpah to stand up and openly demand that its rights be respected by the Commission and Germany, the biggest, most powerful EU member country, rather than being cowed into silence for fear of angering or offending its wealthy Western patrons.

That Ukraine did so citing legal language published in the EU’s own official journal made the move particularly delicious.

Publicly, EU officials offered little reaction to Ukraine’s maneuver. German Chancellor Angela Merkel pledged to work to protect Ukraine’s role as a gas transit country. The Commission reiterated that the EU does not view Nord Stream 2 as being in the bloc’s collective interests — despite Germany’s contradictory view — and said it remained open to discussing the issue with all partners, including Ukraine.

Privately, however, many officials and diplomats were chuckling and delighted by Kyiv’s gumption. In 2009, the EU created its Eastern Partnership program to make former Soviet states, including Ukraine, Georgia and Moldova, more European through political association agreements and comprehensive free trade agreements. With Ukraine, Brussels is suddenly getting more than it bargained for as Kyiv insists that partnership goes two ways.

“They are absolutely right,” said one senior EU official. “In the institutions, there is a sense of my colleagues … [that the] the Association Agreements imposes obligations on the Ukrainians, rather than mutually.”

A senior EU diplomat said Kyiv’s reaction was justified — but perhaps also a long shot and potentially ill-conceived. “The recent Ukrainian initiative is a shrewd one, sure,” the diplomat said. “I, however, wonder why they haven’t done it earlier.”

Ukraine’s pointed message

The note verbale that Ukrainian Foreign Minister Dmytro Kuleba sent to the EU last week pointed out that according to Article 274 of the 2014 agreement, the EU and its member states are obliged to “consult and coordinate” with Ukraine on energy “infrastructure developments” and “shall cooperate on matters related to trade in natural gas, sustainability and security of supply.”

And under Article 337, according to Kuleba, the parties had committed to establishing “effective mechanisms to address potential energy crisis situations in a spirit of solidarity” — particularly crucial language given a recent Court of Justice of the European Union decision that solidarity is not a throwaway term but carries specific legal weight in the context of energy policy.

In Ukraine, the Nord Stream 2 situation is viewed simply as requiring the EU to adhere to its own rules and hold its member states to the same standards it demands from aspiring member countries.

“I think we have a different approach to the Association Agreement,” said Svitlana Zalishchuk, a former member of the Ukrainian parliament and foreign affairs aide to the deputy prime minister. “It says in the document that it is a bilateral document and it has been ratified by all 27 member states, and by the EU itself, and it imposes the liability for both sides.”

“It’s not just Ukraine’s obligations to do reforms,” added Zalishchuk, now an international affairs advisor for the chief executive of Naftogaz, the Ukrainian national gas company. “It’s also the EU’s obligation to apply the same principles that are working in the EU toward Ukraine.”

Zalishchuk said that in the case of Nord Stream 2, Germany appeared to be violating provisions of the EU’s Third Energy Package, a legislative package governing the gas and electricity market that Ukraine adopted as its own national law.

“You cannot demand Ukraine to reform itself in accordance with these European rules and then violate these European rules,” she said. “This is bizarre and in particular with Nord Stream 2.”

But if the diplomatic parry was a sign that Ukraine could potentially out-EU the EU, it also represented a different type of breakthrough for the country that has been fighting Russian-backed military aggression for seven years — winning public recognition that it must defend its priorities even at the risk of infuriating some of its most important protectors.

“I think Ukrainians have restrained themselves quite a lot, asking the most natural questions, who are our friends then,” the senior diplomat said.

An adviser who has worked extensively with Ukrainian government officials said: “Ukraine has learned a little bit more, and been a little bit less beholden. The important thing is the Ukrainians are showing a little bit of their own identity and not just being the grateful recipient of donor assistance and technical support. They are not being ungrateful but I think acting more like a country.”

Standing more on its own has meant refusing to simply accept the terms of the U.S.-Germany Nord Stream 2 deal, which many experts say does not offer Ukraine sufficient financial or security guarantees.

Those experts say the West has underestimated the security risk Ukraine faces if Russia no longer needs the existing pipeline that it uses to transit gas to Europe across Ukraine. Rendering that pipeline unnecessary would potentially remove perhaps the biggest obstacle for Russian President Vladimir Putin in supporting a wider-scale military attack, or even ordering an invasion.

While Ukraine’s top goal is to kill Nord Stream 2, Naftogaz has floated an alternative approach that would secure Ukraine’s transit revenues by giving EU gas traders the option to have Gazprom, Russia’s state-controlled supplier, deliver orders immediately at Ukraine’s eastern border. That would mean the gas transported or stored in Ukraine’s pipeline system would belong to Gazprom’s European customers, not Russia.

Such a strategy could well win the support of EU countries most vocal about Russia as a security threat, especially Poland, Lithuania, Latvia and Estonia.

The Western powers’ stance

The security risks have not stopped bigger Western powers from putting their own interests first.

Germany views Nord Stream 2 as a crucial commercial project that stands to lower the country’s energy costs. And U.S. President Joe Biden, while opposing the pipeline project, has refrained from imposing sanctions to kill it, citing the importance of rebuilding relations with Germany, ties that suffered under former President Donald Trump. Advisers to Biden see close ties with Germany as essential to developing a united Western position vis-a-vis China, which they regard as a more important rival than Russia.

After Ukraine refused to keep quiet about the U.S.-Germany deal on Nord Stream 2, the Biden administration finally announced a date for Ukrainian President Volodymyr Zelenskiy’s promised “summer” visit to the White House: August 30, literally in the quietest days of summer when few are around Washington. Some supporters of Ukraine in Congress have complained, saying Zelenskiy and Ukraine deserve better, accusing Biden of trying to prevent U.S. legislators from hearing directly about Ukraine’s plight.

Zelenskiy’s outspokenness in opposition to the U.S.-Germany deal is a striking contrast to his response after being drawn into Trump’s impeachment scandal.

Despite facing heavy pressure from Trump, who tried to withhold crucial military aid until Ukraine investigated Joe Biden’s son, Zelenskiy refrained from criticizing the U.S. president. He was, in fact, even recorded on a phone call largely acquiescing to Trump’s various conspiracy theories.

As the scandal unfolded, Zelenskiy and his staff did their utmost to avoid public comment on the impeachment matter.  

In Kyiv, many officials believe Ukraine has earned better treatment by Washington, but even more so by Brussels given the country’s unrelenting push to implement the EU’s desired democratic reforms.

European leaders have long adopted a “more for more” mantra in relation to prospective EU member countries, insisting that they will enjoy more benefits, such as visa-free travel and greater access to the EU’s single market in exchange for such reforms.

Ukrainian officials, however, insist that no matter how much more they do, all they will get in return is further demands for more, more, more.

And it’s not just the EU. A NATO communique following a summit in Brussels last month recognized the aspirations of Ukraine and Georgia to join the alliance, but only singled out Ukraine in demanding further anti-corruption efforts, saying: “The success of wide-ranging, sustainable, and irreversible reforms, including combating corruption … will be crucial.”

Ukrainian diplomats said last week’s demand for consultations was not the first time Kyiv had invoked provisions of the Association Agreement to demand consultations. It did so in 2017 when it had concerns over the OPAL gas pipeline, Nord Stream’s on-land extension, which runs along Germany’s eastern border. The difference then, diplomats said, is that Ukraine made the demand quietly, while Poland undertook a long court battle against Germany’s decision to allow Gazprom to increase its use of OPAL. This time, they said, Kyiv officials went public and demanded talks not just with the Commission but also with the German government.

Earlier this month, the EU’s Court of Justice sided with Poland on the OPAL dispute and rejected an appeal from Germany.

Zalishchuk said officials in Kyiv have followed the case closely, viewing the decision as an important precedent in the battle against Nord Stream 2.

‘The main conclusion of the court is wonderful,” she said, noting that Poland had built its case on the notion that the EU’s solidarity principle has a concrete meaning in the energy sphere, while Germany argues against such a definition. “But what the EU court says is ‘no guys, what’s in the fundamental documents of the EU is not just words. And if there is a solidarity principle, it has to be understood in its fundamental meaning that the infrastructures and capacities that already exist in the EU cannot be detoured or violated.'”

This article is part of POLITICO’s premium policy service: Pro Energy and Climate. From climate change, emissions targets, alternative fuels and more, our specialized journalists keep you on top of the topics driving the Energy and Climate policy agenda. Email [email protected] for a complimentary trial. 



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