The Story of Maidan: Part 4 — Match in a tinderbox — the Associative Agreement
“Ukrainians learned that their country really does lie on a fault line between two civilizations […] as a country lying between the civilization of institutions and of the rule of law, as epitomized by the European Union; and the civilization of arbitrary rule, as embodied by the Russian president, Vladimir Putin.”
Ann Applebaum, historian and journalist, Nov 28, 2013. 
On March 4, 2012 the foreign minister of five EU-countries, Carl Bildt, William Hague, Karl Schwarzenberg, Radoslav Sikorski and Guido Westerwelle stated in an Op-Ed in The New York Times:
“This day five years ago, the European Union and Ukraine started negotiations on a groundbreaking new agreement with the aim of fostering Ukraine’s political association and economic integration with the E.U.
By now, we should have been able to celebrate a signed and ratified agreement, and a successful Ukraine making progress toward even closer cooperation with the E.U. Instead, we pass a new milestone on what is becoming a much too long and painful road. Today, however, we are at an impasse in the association process.”
The officiaries are careful with offering reasons for that impasse but it becomes clear that while the process started well under the pro-western president Yushchenko, it stalled under Yanukovych. Especially the show trials of Yulia Tymoshenko, former interior minister Yuri Lutsenko and others were seen as a clear violation of a value framework the EU expects it’s partners to adopt as well. They name democracy, human rights and the rule of law as “the values underpinning the association agreement”. They don’t connect the dots and point out the lack of those in Ukraine. They just believe that 20 years of independence “brought an irreversible change in the mentality of the Ukrainian society. The Ukrainians are Europeans and share European values.”
But the agreement was in the making, it was expected to be signed in November 2013 after years of negotiations. At some point Moscow woke up to the perceived threat. Would Russia loose an ally in their planned Euro-Asian customs union? It is often thought that Russia is so much bigger than Ukraine, but in fact, they population is only three times larger. Ukraine is an important partner in trade, both ways.
2013 was a year where Russia put the thumbscrew on. When Moldova leered towards the EU, Russia imposed a ban on Moldovan wine, the nr. 1 in a small list of export goods. In August 2013, Russia suddenly stopped imports from Ukraine. This ban was up only for a week. But senior economic aide to Putin, Sergei Glazyev made it clear that this could become permanent if Ukraine signed the association agreement. He called that “suicidal”.
Russia used their economic leverage in the region. Lithuania (which is in the EU) was banned from exporting dairy products to Russia. Armenia capitulated and joined the customs union of Russia despite having no shared border with any of its members and despite protests in Yerevan against it.
Moldovas president Timofti said: ““We realize Russia has geopolitical interests in this area but there is also a saying here — ‘You cannot enter the same river twice,’ It is impossible to recreate the union that used to exist. However, Russia does take action to keep its influence over this region.”
Ukraines predicament is visible for quite a long time. Already in February 2013, the country is trying to maneouvre into all directions. But EU commission chief Manuel Barroso makes it clear: “A country can’t be member of a customs union and be in a free trade zone with the EU at the same time.”
President Viktor Yanukovych seems trapped between two economic poles. He secretely meets Vladimir Putin, the last time on November 9, 2013. It is not known what they talked about. But afterwards, politicians suddenly spoke of a “Return to Russia”. TV-stations put popular Russian TV series back on air. And we know the result. On November 21, a week before signing, Ukraine puts the deal on ice. Official reason: “Danger of national security.”
The EU got angry. Catherine Ashton, the EU’s foreign policy chief, said in a statement: “It would have provided a unique opportunity to reverse the recent discouraging trend of decreasing foreign investment,” she said, “and would have given momentum to negotiations for more financial aid from the International Monetary Fund.”
“Ukraine government suddenly bows deeply to the Kremlin,” the Swedish foreign minister, Carl Bildt, wrote on Twitter. “Politics of brutal pressure evidently works.”
But there might haven been a good reason for this sudden reverse in policy. Ukraine faced severe economic problems and needed new credits immediately. The EU was certainly in no position to grant them.
Historian Ann Applebaum lays it out in simple terms: “the European Union can’t offer the most enticing sort of carrot when it is creating a relationship with a neighbor, and it can’t proffer an impressive stick. Instead, it can propose a mild, undramatic association agreement, designed to promote wider contact and trade. The president of Estonia tells me that his country’s own association agreement, signed in 1995, was so mild that it had little immediate impact. The only real change became visible years later. At first, thousands of Estonians were suddenly able to study at European universities. Those who did so are now the leaders of a far more prosperous country.”
In a statement president Yanukovych said that his country could only sign such a contract, if it became strong first. “As soon as we have a level that suits us, when it is in our interest, when we can negotiate under normal circumstances, then we can talk about signing.”
His predecessor and arch enemy Yuschenko added that the EU had no strategic vision towards Ukraine. The country supposedly had passed a number of strict reform law but the EU would push too much on the Yulia Tymoshenko issue.
But what was actually in the proposed agreement? It is a tough read with more than 1000 pages, written in lawyer speak, and nobody near to explain it to the population. In a presentation (a.k.a. sales brochure) the EU advertised six bilateral aspects: New contractual relations, integration into EU economy, easier travel to EU, energy and transport cooperation, economic and social development and financial support.
Now what does that blabber actually mean? New contractual relations includes a deeper cooperation on justice and security issues. Economical integration means a “comprehensive free trade area”. And there is the first catch in an contract between unequally strong partners. If you delve into the agreement you can read: “All partners should eliminate customs duties”
It means that goods and services can be sold and bought without customs tax in either economic sphere. A good thing, Ukrainian goods get cheaper in the EU and vice versa. But who benefits from this? How many Ukrainian goods have we seen in European supermarkets? Very little while a felt 50 percent of all goods in an Ukrainian supermarket origin in the EU. The tax exists to protect Ukrainian products on their homemarket against foreign products. So this part of the agreement opens the Ukrainian market even wider and makes their own goods less attractive. Ukraine can only sell in the EU if it fullfills trade norms. Part of the agreement is the “approximation of Ukraine norms to the ones of the EU.” The agreement does not come with the necessary funds to upgrade Ukraines economy and it does not compensate for the losses on the Russian market, once Ukraines products no longer follow Russian standards.
Besides the cost there would be guaranteed losses in the trade with Russia without the guarantee to succeed in Europes markets. Huge losses: by 2010 Ukrainian 40 percent of its exports went into the EU, 30 percent into the Commonwealth of Independent Nations (Russia and the other former Soviet Repulics) and 30 percent to Asia and the rest.
Yanukovych probably hasn’t been to a supermarket for a while but his economic aides will have told him that even with Ukraines best products, vegetables and fruits, they are not competitive. Not for lack of quality, on the contrary. But for price. They are simply cheaper in Europe. Although wages in Ukraine are in the vicinity of a thrid to a tenth as in the EU, the level of industrialization is so far worse that production cost for produce is too high.
The freetrade agreement limits intensive economic relationships of Ukraine with non EU bodies such as Russia. That is seen as an either-or choice for Ukraine. Although it is not part of the Eurasian customs union it benefits from free trade agreements with them. Naturally Russia put that benefit in question.
So in the eyes of Ukraine, the agreement guarantees nothing, promises little and would lead to certain losses. Not a favorable deal. Or to put it more optimistic: a long term prospect in time of short term mega crisis.
Nevertheless the Ukrainian people were more in favor of the EU agreement than Russias custom union. In May 2013, polls put it at 42 vs. 31 percent.
On the Eastern Europe meeting in Vilnius, Lithuania; Yanukovych made it official. He said he still wished to sign the agreement, but due to the pressure of Russia he needed the small sum of 170 billion Euros until 2017 as compensation. Naturally the EU didn’t buy that badly covered blackmail. Both Georgia and Moldova pre-signed their agreement in Vilnius.
Historian Timothy Snyder offers a theory of the working mechanism behind Yanukovychs decision: “Ukrainian president Viktor Yanukovych seems to believe, and he is not alone, that because Ukraine lies between the European Union and Russia, each side must have an interest in controlling it, and therefore that smart geopolitics involves turning them against each other. What he does not understand is that these are two very different sorts of players. For the EU even to reach the point of offering an association agreement, creative European leaders had to make an insistent push to gain support from member states, and hundreds of constituencies had to be satisfied. Yanukovych seems to have thought he could simply ask the EU for cash, on the logic that Putin was offering him the same. There is a point where cynicism turns into naïveté.”
There is a very interesting interview done by opposition journalist Mustafa Nayim with Irina Bohoslovska. She is a 53-year old lawyer and member of parliament with Yanukovychs Party of Region and a one time contender for the presidency in 2010. After the first day of police violence on November 30th she leaves the party in protest calling for the President’s resignation. On the question of what Putin had offered she answers: “I don’t know. I can say with absolute certainty that if Yanukovych had signed the agreement he would 100 percent have been reelected. — And he knew this himself! In the last meeting with the (parliamentary) faction (of the Party of the Regions) he actually forced his will on everybody who was in favor of the Russian vector.”
Was the Party of Regions united in their decision to join the EU? “We had swings. Two months ago, Yanukovych met with the faction. It was a closed meeting. He was at his most forceful and took charge of the situation in a virtuoso manner. About one third of those present were against the EU. He simply steamrollered them, bent them to his will.“
The decision not to sign was first put to the public in a press conference. According to Bohoslovska, prime minister Azarov who would not do anything without Yanukovych’s consent hadn’t even agreed the decision with the faction.
So why did the Party vote against the EU-agreement in parliament? Because as Bohoslovska claims, there was a signal given to delay until the last moment for getting a better deal with the EU and then pass and sign it all in one day.
And then another signal was given not to sign at all. That signal came from two people: Victor Medvechuk and Andriy Kluyev. The first one has no official state role except being a special envoy from Putin (Putin is the godfather of his daughter). Kluyev is the secretary of the National Security and Defense Council of Ukraine. According to Bohoslovska the two men wrote the constitutional ammendments that brought Yanukovych so much more power.
Journalist Nayim states in the interview: „But Kluyev himself was leading the negotiations for one and a half years, he initiated the agreement [with the EU].“
„ Hold on, you are being naïve,“ the politician answers. „Andriy Kluyev is a figure who is always being used to mislead people. This is his role.“
Nayim: „So Yanukovych treated his ‘family’ ministers the same as the party faction, that is to say he mislead them?“
Bohoslovska: „Yanukovych ‚surfed.’ It seemed to him that he had caught some kind of wave but in reality fell into a whirlpool. I cannot explain what happened. Yanukovych has buried himself as president in 2015, he has buried his country, the stability which he developed all his life and which was his key feature. When Yanukovych came, the economy grew and the population became calm. He has simply blown himself up… “
In my opinion it was correct to not sign the agreement. The error lay in preparing the deal for years without inclination to sign and in not communicating the issues to the population. Again this is my personal view and I would like to see some research on it, but I feel that Ukrainian officials (including those in power after Maidan) have no clue on how to involve it’s citizens in their decision making. Especially with the agreement and the Vilnius meeting, this lack proved fatal. On November 29, 2013, Yanukovych and his entourage came back home to a totally different reality.
The next chapter, Part 5 — EuroMaidan is born looks at the very first days of the protests in Kyiv.
 New York Times, http://www.nytimes.com/2012/03/05/opinion/05iht-edbildt05.html?ref=europe&_r=0
 New York Times, http://www.nytimes.com/2013/10/23/world/europe/russia-putting-a-strong-arm-on-neighbors.html?_r=0
 Der westen, 25.2.2013 http://www.derwesten.de/politik/ukraine-will-sich-nicht-auf-eu-festlegen-id7657836.html
 Die Zeit http://www.zeit.de/politik/ausland/2013-11/timoschenko-ukraine-eu