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Download the pdf version
What’s wrong with the Eurasia Economic Union (EEU), the economic block set up by Russia that is a copy of the EU and was supposed to promote stability and prosperity throughout the Eurasian landmass?
Three out of the five members of the EEU are in flames and many of the countries around it that resisted Russian President Vladimir Putin’s strong-arming them to join are not much better off. A wave of protests and now even a war have swept over the region to join long-standing frozen conflicts that show no sign of ever being resolved.
Belarus is facing its biggest demonstrations since independence in 1991. It was joined by Kyrgyzstan yesterday, which erupted into riots following yet another fixed election. Bulgarians have been on the streets for months to protest against corruption, and even in Russia the Kremlin has been struggling to contain protests in the Far Eastern city of Khabarovsk, which are also in their third month. And if that were not enough, Armenia and Azerbaijan just went to war with each other.
Beware the Ides of August
In July Chris Weafer, CEO of Macro Advisory, wrote his annual op-ed for bne IntelliNews: “August in Russia: what could possibly go wrong.” August is supposed to be the quietest month of the year as everyone goes to the dacha for the long summer holiday – and it almost never is. But this year’s set of summer crises have been off the scale.
Weafer caught many of the crises that have since blossomed: the coronavirus (COVID-19) pandemic, protests in Russia’s Far Eastern city of Khabarovsk, and possible new US sanctions, the threat of which has crushed the value of the ruble in recent weeks. He even correctly pointed out that presidential elections in Belarus could blow up and even more presciently called out the rising tensions between Azerbaijan and Armenia to the south of Russia.
“On the southern border, the main concern is the steady increase in the fatal clashes between Armenian and Azerbaijani forces on either side of the Nagorno-Karabakh border,” said Weafer.
Well done. Weafer’s only lacuna was his failure to call this week’s outbreak of riots in Kyrgyzstan, but you can’t expect oracles to get everything right...
bne IntelliNews has been reporting extensively on all these stories as they unfold but recapping the main points and you get an unsettling list.
Rioting broke in Kyrgyzstan on October 5 following parliamentary elections a day earlier that were widely seen as fixed. Following the vote, only four parties out of 16 passed the 7% threshold for entry into Parliament, three of which have close ties to Kyrgyz President Sooronbay Jeenbekov. As bne IntelliNews went to press it looks like the crisis is already over, as the Central Election Commission (CEC) has called for fresh elections that have to be held within two weeks.
The rapidity with which the government caved to the protesters' demands may have something to do with the mass demonstrations in Minsk following another stolen election on August 9. Belarus' self-appointed President Alexander Lukashenko massively falsified the vote to hand himself a landslide victory, a result that has been rejected by the overwhelming majority of the population.
The Belarusian protests have just gone into their second month and show no sign of abating as the authorities slowly crank up the violence and introduce full-on Soviet-era repressions, not seen for three decades.
The demonstrations in the Far Eastern Russian region of Khabarovsk and those in Bulgaria have been going on even longer – over three months now.
The people took to the streets in Khabarovsk after the Kremlin arrested the popular local governor Sergei Furgal on murder charges and appointed its own placeman instead, leading to the largest domestic protests since the 2011 mass demonstrations in Moscow against a fixed Duma election. And while Bulgaria is not a member of the EEU and joined the EU instead, the people there have also been determinedly protesting against official corruption in a movement that has crushed trust in the authorities and proved an embarrassment for the EU.
And the war that has broken out in Nagorno-Karabakh is the worst clash between the two bitter enemies of Azerbaijan and Armenia in decades. While the details are still unclear, it appears that Azerbaijan attacked the disputed enclave of Nagorno-Karabakh on September 27 that is controlled by Armenia and within a week the two sides are now on the brink of a full blown war as the fighting spills over the border to Azerbaijani territory. Of all the political crises going on at the moment this is the only one that is the result of a border dispute left over from the break-up of the Soviet Union and the creation of 15 new countries. From this perspective, the break-up of the Soviet Union went remarkably smoothly.
Most of these countries are members of the EEU: Armenia is, but Azerbaijan isn’t, although both countries are friends with Moscow, which has been mediating their dispute since the 1990s; it also sells arms to both sides.
Belarus and Kyrgyzstan are also both members of the EEU, although Bulgaria isn’t, but it does suffer more than the other EU accession countries from the same sort of problems most of the countries of the FSU suffer from: corruption, poverty and a backward economy.
These are just the “hot” conflicts. In the background the war between Russia and Ukraine is now in its seventh year and the Crimean Peninsula remains firmly in Russian hands. The occupation of the formerly Georgian territory of Abkhazia and South Ossetia by Russia remains unresolved, as does the dispute over the Transnistria region between Moldova and Ukraine.
And more disputes are on the cards: Moldova goes to the polls this autumn; the Kremlin has already been accused of meddling in previous votes there.
What the hell is going on?
Why are all these problems appearing now? For most of the last three decades the majority of the countries emerging from the former socialist block have been hard at work trying to rebuild their collapsed economies. The protests and the war are probably the result of the interplay of three factors.
First, and most obvious, is the economic hardship inflicted not only the members of the EEU but all the countries of the Former Soviet Union (FSU) by the coronavirus (COVID-19) lockdowns that have caused massive economic damage across the region.
Incomes have fallen. Trade has been decimated. Travel halted. Economies have seen massive contractions. Unemployment has soared, especially in the poorer countries. And most importantly, remittances, which have been a lifeline for states such as Armenia and Kyrgyzstan, have evaporated.
Secondly, this is the end-game for the break-up of the Soviet Union. While the Soviet Union was formally dissolved in 1991 at a meeting in Minsk, that only started the beginning of the process of moving beyond the totalitarian system of centrally planned economies.
Minsk is the perfect example. Under Lukashenko it has been the last hold-out of the Soviet system, as the president has run it as a neo-Soviet command economy where the state controls almost everything of value and employs a very large share of the population.
This system worked surprisingly well, as Lukashenko managed to shelter a large part of the population, the most vulnerable part, from the worst ravages of “shock therapy” and a decade of destitution. He could afford to do this thanks to the generous energy subsidies from Russia that allowed the government to subsidise an otherwise hugely inefficient system.
Minskians have described their parallel lives where they co-existed with the quasi-Soviet state, but focused mostly on their private lives. The August 9 elections broke this delicate equilibrium and the people are now demanding a definitive end to Lukashenko’s system and the introduction of a modern democratic system instead.
The story is very similar in the other countries like Ukraine, Bulgaria and even Russia; however, in these places it is corruption that is the more significant factor.
This tension has already boiled over in several countries producing their coloured revolutions. Ukraine and Kyrgyzstan have already ejected two presidents in mass protests, while Georgia and most recently Armenia have done the same.
Other countries in the region have been plagued by large demonstrations in the last year, including Romania, which saw almost half a million people take to the streets to protest against blatant corruption. There were mass demonstrations in Moldova after bankers connected to the president walked off with $1.5bn in a massive banking scam. Serbia has seen months of street protests at the start of the year. And both Georgia and Armenia have had regular large demonstrations in addition to their full blown revolutions. Even Russia has experienced a string of large demonstrations in the last year against smelly rubbish tips and the closure of local parks by greedy local administrations.
While the popular desire for more political freedom does not always end in a colour revolution – which are economically destructive – it is a powerful force fuelling domestic politics across the region. Increasingly managing the population’s expectations has become the overriding task of the long-serving presidents in the region. They ignore this force at their own peril.
Thirdly, and most subtly, has been the ongoing process of the population of the CIS becoming more politically mature. This is not just about rejecting one system for another. This is about the people coming to realise they have the power to dictate to their rulers through the power of their vote – and when that is denied them, through the power of street protests.
Several factors are feeding into this process. In Russia, for example, the youth have largely abandoned watching TV in favour of online channels like YouTube, where the likes of anti-corruption blogger and opposition activist Alexei Navalny and blogger Yuri Dud are active and reach millions of people. The biggest website in Europe in terms of the number of users (excluding the international sites) in 1990 was Vkontakte (VK.com), the Russian answer to Facebook, which ranks number 14th overall. That means the Kremlin has lost control of the political message.
It also means the entire population are well informed about other protests and demands in other countries. It is no co-incidence that Belarusian flags have appeared at the protests in Khabarovsk, as the call to action and protesters’ demands have informed protests in other counties.
The bloody end to Ukraine’s Euromaidan revolution in 2014 and the economic collapse that followed are almost certainly responsible for the Belarusian opposition leaders' clear insistence on exclusively peaceful protests. The geopolitical mess Ukraine finds itself in now, caught between the White House and the Kremlin, has led the Belarusian opposition to carefully reject taking sides in the geopolitical showdown between East and West, and their promises to maintain close and friendly relations with Russia as well as develop relations with the EU.
By the same token, Ukraine’s bitter experience acts as a restraint on Russian protests, as after a decade of prosperity in the noughties the Russian people have a lot more to lose than the Ukrainians did in 2014.
As Bulgaria’s experience shows, the problems faced by the members of the EEU are not exclusive to them but shared by all the countries in transition.
The population began its post-socialism journey politically immature and have had to learn the power of their vote. That is the essence of the showdown in Minsk: the people voted for a new president; Lukashenko has totally ignored those votes, so now the people are insisting on their right to choose a president via voting and their overriding demand is simply for new free and fair elections.
Most of the people living in the East were merely trying to survive in the 1990s. Three decades on and life is relatively normal in most countries in the region. Increasingly satisfied with their income the people are increasingly dissatisfied with the performance of the government. Instead of demanding more money, they are starting to think about the long term – their own old age, their children’s future – and demanding instead better services from the government and responsible and responsive leaders.
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