Everyone Loses: The Ukraine Crisis and the Ruinous Contest for Post-Soviet Eurasia

The AA also has shades of geopolitics, even if of the dull, procedure-obsessed EU variety. It creates a ministerial-level Association Council, which gathers regularly and is invested with the power to make decisions regarding AA implementation; a senior-official-level Association Committee; a Parliamentary Association Committee, composed of parliamentarians from the EU and the partner; a Civil Society Platform; and sector-specific committees. All these bodies have equal EU and partner-state representation. In the case of Ukraine, there are also summit meetings at the presidential level.

As Romano Prodi, former president of the European Commission, put it, the AA/DCFTA model provides these countries with ‘everything but the institutions’, full integration with the Union but no direct participation in the decision-making bodies in Brussels.[56] A country that fully implements the AA would become like Norway, which remains outside the EU but as a member of the European Economic Area (the EU’s single market) must comply with the acquis. The main practical difference is that Oslo, unlike member-state capitals, cannot take part in EU policymaking.

The requirement to adopt the acquis was a powerful lever for reforming the domestic political economies of the new EU members in East Central Europe. So it was perfectly understandable that the EU chose to make this same compendium of rules its primary means of engagement with the In-Betweens, all of which are urgently in need of reform. But the AA does not just spur reform; it is also a geo-economic and geo-ideational exercise. On the macro level, the DCFTA precludes membership of any other customs union (including, as we shall see, the one Russia began ginning up in the same period); put differently, membership of a customs union precludes signing the DCFTA. Classic customs unions oblige members to relinquish national decision-making on tariffs and related matters to a supranational body; the DCFTA by definition requires signatories to maintain such prerogatives for themselves. The inherent take-it-or-leave-it and one-size-fits-all nature of the DCFTA also eliminates the intermediate option many states pursued before: some meshing with both Russia and the EU. It would leave states highly integrated with the EU, while commercial links to Russia (and other CIS countries) would attenuate over time. All 12 non-EU former Soviet republics had, since 1992, shared the same regulatory and technical standards, measurements and certification formats.[57] If one of them were to replace these with (more rigorous) EU standards, its trade with the EU would be facilitated, while trade with other CIS countries could be hindered relative to the status quo ante. And given the nature of the agreement, AA signatories would have to adapt to many EU economic-policy decisions in the future. Brussels would gain pre-eminent influence over policymaking in signatory countries, displacing the influence of any other outside actor. The EU operated on the assumption that its normative hegemony was unassailable.

Russia was anything but welcoming of this new EU activism. But Brussels acted as if Russia did not exist. There were no consultations with Moscow, even though Russian officials had begun to object stridently. The hypersensitivity over steps that could evoke the ghosts of Yalta effectively ruled out conversing with Russia about Ukraine or any other In-Between. In fact, doing so would not have been unprecedented. On the eve of the admission of the Baltics and five other ex-communist countries in 2004, extensive trilateral negotiations had taken place among the EU, Russia and the soon-to-be members. Adjustments were made to accommodate Russian concerns, ranging from an extended adjustment period on aluminium exports to Hungary to special transit arrangements between the exclave of Kaliningrad and the rest of Russia.[58]

Even if Russia had welcomed the EU’s involvement with the In-Betweens, the AA/DCFTA model might not have been the right policy instrument for the region. Better formal laws and regulations cannot cure basic pathologies of governance in these countries, which stem from corrupt informal political-economic practices and feeble and often imitative democratic institutions. As we will see, no hard evidence to date has shown that the agreements produced positive changes in governance in the three countries that eventually signed up: Moldova, Georgia and Ukraine.