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

More important than these tactical considerations, Yanukovych’s waffling reflected the bedrock economic realities of his country. Ukraine’s trade was divided almost evenly between the EU and Russia. So Yanukovych’s attempt to avoid a binary choice between them was understandable, even if other motives were also in play. Unfortunately, neither the EU nor Russia offered him a way to do so. Speaking for the EU in December 2012, one official pronounced it ‘impossible for Ukraine to align with both [the EU and the Customs Union] at the same time. Ukraine should choose which path to take…. Even partial accession to the Customs Union… would be problematic.’[11] The next month, a senior Russian diplomat used more colourful language to make the same point from Moscow’s angle: ‘Ukraine wants to simultaneously maintain two vectors: both to join the EU [sic]… and to participate in the Customs Union, but only in those areas where it stands to gain. But things don’t work that way. You cannot be a little bit pregnant.’[12] A geo-economic confrontation was in the offing. Both the EU and Russia were less interested in preventing it than in prevailing in it.

Russia seemed to soften its position in May 2013, when Ukraine, while in the last stages of negotiations with the EU on the AA, signed a memorandum on cooperation with the EEC, granting Kyiv observer status. Yanukovych called European Commission president José Manuel Barroso the same day to reassure him that the memorandum did not contradict the AA. But Russia was not content with Yanukovych’s plan to integrate only to the extent that Ukraine’s EU commitments allowed. The very day the memorandum was signed, Glaziev said ‘Observer status is only granted to states that want to join our integration project…. Since we agreed to give Ukraine observer status… that means Ukraine intends to join our union.’[13] Ukraine had never spoken of such an intention.

Moscow was still pushing hard on Yanukovych – but its bottom line seemed to have shifted. Some observers claimed that Russia would still accept nothing less than full Ukrainian membership of the Customs Union (and subsequently the EEU). Certainly that was Moscow’s preferred outcome, but by 2013 it was no longer issuing ultimatums to Ukraine to join straight away. The heavy-handed pressure that began that summer came in the context of the impending signing of the AA, planned for the November summit of the EU and the In-Betweens (in EU-speak, the Eastern Partnership countries) in Vilnius. And if that went ahead, Ukraine would be forever lost for Russia-led integration efforts. Russia was now primarily concerned with forestalling that outcome and keeping the prospect of eventual integration open, rather than demanding immediate Ukrainian membership.

The instrument Moscow deployed was characteristically blunt. Beginning in July 2013, Russia imposed trade sanctions on Ukraine, first by cutting off imports of confectionery products, fruit, vegetables and poultry. It then hit steel manufacturers and other exporters with cumbersome new customs procedures. ‘De facto, there is a complete halt on Ukrainian exports’, the Ukrainian manufacturers trade group reported.[14] For several days the next month, the Russian authorities applied extensive customs checks to all Ukrainian imports, all but totally blocking them.