Interviewee: Steven Pifer, Visiting Fellow, Foreign Policy Center, United States and Europe, Brookings Institution
Interviewer: Bernard Gwertzman, Consulting Editor, CFR.org, 
Council on Foreign Relations, New York, NY, Friday, July 24, 2009

DELIVERING TOUGH LOVE TO UKRAINE, GEORGIA 

Interviewee: Steven Pifer, Visiting Fellow, Foreign Policy Center,
United States and Europe, Brookings Institution
Interviewer: Bernard Gwertzman, Consulting Editor, CFR.org, 
Council on Foreign Relations, New York, NY, Friday, July 24, 2009

Steven Pifer, a former U.S. ambassador to Ukraine and expert on former Soviet republics, says Vice President Joseph Biden's recent trip to Ukraine and Georgia was meant to balance President Barack Obama's Moscow summit earlier in the month. But in both countries, Pifer says, Biden had to convey tough messages.

In Ukraine, his message to Ukraine's feuding leadership  was to repair relations and resolve their energy crisis, caused in large part by heavily subsidized domestic prices.

In Georgia, Biden wanted to press Georgia's leaders on domestic political reforms, but he also made it clear that there was no way for Georgia to use military force to regain South Ossetia and Abkhazia, the two provinces that have now been recognized by Russia as independent.

Vice President Joseph Biden has just completed a trip to Ukraine and Georgia to reassure both of those former Soviet republics that the American desire to "reset" relations--Biden's words in Munich last February--with Russia were not meant at their expense. But he also had what one Biden aide called "tough love" for both of them.

QUESTION: Could you elaborate on this trip?
That was the first point of the trip: to reassure Kiev and Tbilisi that the United States remains interested in robust relations with Ukraine and Georgia, and that we will work to keep open their pathways to Europe and the North Atlantic community. When I was in Ukraine about five or six weeks ago, what I heard from the Ukrainians was a concern--and I suspect there is a parallel concern in Georgia--that the effort to reset relations with Russia would somehow come at Ukraine's expense.

So part of the trip by the vice president was to assure both Ukraine and Georgia that the United States is not going to undercut relations with those two countries as it tries to develop relations with Russia.

You've seen points made by this administration, indeed going back to the Munich speech itself, saying the reset of relations would not mean recognition of a Russian "sphere of influence" over the former Soviet states, and then repeated assurances that the United States supports the rights of countries such as Ukraine and Georgia as sovereign states to choose their own foreign policy course.

What was also interesting to me was that in his speech in Ukraine, Biden was virtually demanding that the Ukrainian leadership get their act together. In Georgia, I don't think he was publicly as tough. Can you elaborate on the "tough love" part of the visits?

Let me start with Ukraine. Certainly the primary goal of the visit was to reassure Ukraine, but there was also a tough message there. In Ukraine, it's not only due to the presidential election, but you've had a situation in the past year and a half where the government really hasn't functioned because of infighting between President Viktor Yushchenko and Prime Minister Yulia Tymoshenko.

It's meant that Ukraine has passed up opportunities to accomplish some important things. A big part of the vice president's message in Kiev was to say, "You need to put aside political differences, come together as mature political leaders, find compromises, and get things done."

A big part of the vice president's message in Kiev was to say, "You need to put aside political differences, come together as mature political leaders, find compromises, and get things done."

He also singled out the importance of Ukraine getting serious about reforming its energy sector. This is a huge national security vulnerability for Ukraine because they have a distorted price structure where people buy natural gas at prices that don't begin to cover the cost of the gas that Ukraine buys from Russia. As a result, Naftogaz, the national gas company, is perpetually in debt to Russia and on the verge of bankruptcy. That creates vulnerabilities for Ukraine.

Part of the vice president's message was, "You need to get serious about this." Part of the problem in Ukraine is if you are a household, you are probably paying a price that amounts to less than 30 percent of the actual cost of the gas bought from Russia. It's no wonder why Naftogaz is always in financial straits. But it's not just an economic problem because of the way it factors into the Ukraine-Russia relationship.

It creates a national security issue for Ukraine. So there are two aspects to the tough message: One, the need for political leaders to get together, compromise, and produce good policy; and second, the special importance of tackling this energy security issue.

QUESTION: At the time of the 2004 Orange Revolution in Ukraine, Yushchenko and Tymoshenko were united. What's caused this major rift?
This has been one of the surprises and one of the disappointments since the Orange Revolution. Yushchenko and Tymoshenko were allies during the
revolution. Tymoshenko was prime minister for eight months in 2005. She's been prime minister again since December 2007, but the relationship between the president and the cabinet just has not worked. There's been continual infighting where the president blocks cabinet actions and vice versa.

Over the last fifteen or sixteen months, it's been hard to get the $16 billion loan from the IMF [International Monetary Fund]. And it's hard to find too much else that the government has been able to accomplish, in large part because the president, the presidential secretariat, the cabinet, and the prime minister seem to be undercutting each other so badly.

QUESTION: Is it a personal thing?
I suspect part of it is personal. If you go back to December 2007, the initial shots seemed to have been fired by the chief of staff to the president, Viktor Baloga, who has since left that position. In that fight, it seemed to reflect a concern on the part of the presidential administration that in the presidential election, which will be held in January 2010, Tymoshenko would be a strong rival to the president.

There seems to have been an effort to undercut her. Unfortunately, this means the government has not performed as expected. Interestingly in politics what we've seen is that President Yushchenko's rating has fallen to the low single digits. Tymoshenko's rating remains at about 15 percent, falling second in most polls for the president.

QUESTION: It's interesting how the leader of the Orange Revolution has fallen so low in the polls. There's a similar situation in Georgia with President Mikheil Saakashvili, right?

There's a different situation in Georgia. There are two factors motivating opposition to Saakashvili. One is a concern that goes back to the fall of 2007, when Saakashvili was walking back on some of the democratic achievements that Georgia had obtained since the Rose Revolution. And significant opposition has been generated to Saakashvili in the aftermath of the conflict between Russia and Georgia last August.

There's a feeling held by many in the opposition that while the Russians may have provoked the conflict, Saakashvili made a huge mistake. He took the bait and sent the army into South Ossetia, bringing about a strong Russian response that crushed the Georgian military in a matter of days.

QUESTION: Biden met with the opposition both in Ukraine and in Georgia on this rather brief trip, which I guess presidents and vice presidents usually do.

In the case of Ukraine, in addition to meeting with President Yushchenko and Prime Minister Tymoshenko, he also had meetings with Regions Party head Yanukovych, the former parliamentary speaker Yatsenyuk, and the current parliamentary speaker Volodymyr Lytvyn. That's natural. That's appropriate in a country that's five months out from a presidential election.

No matter who wins the election in January, the vice president has met with that person on this trip. That's the appropriate way to show that the United States doesn't have a favorite in that election, and as the vice president made clear, the important thing is that Ukraine continue to demonstrate that it knows how to do free and fair elections, and that it is a leader in the region in terms of democratic progress.

The simple fact is that there's no conceivable defense assistance program the United States could do with Georgia that would give the Georgians the ability to defend themselves against Russia.

In the case of Georgia, there was an effort to meet with the opposition to show some balance. This may reflect some quiet concern on the part of this administration that the Bush administration's policy toward Georgia may have become too personalized with Saakashvili. There's an effort to say the United States wants a strong, robust relationship with Georgia, but perhaps without the personal attachment to Saakashvili.

Certainly there are figures in the opposition--the former head of the Georgian parliament, Nino Burjanadze, and the former Georgian ambassador to the United Nations, Irakli Alasania--who are in favor in Washington. So the approach to Georgia will be more balanced and not so personalized as what we saw in the Bush administration. There's a fine line to walk here, and the vice president is doing it fairly well, where you don't want to signal to the Russians that we're chopping off Saakashvili completely.

QUESTION: Russian President Dmitry Medvedev showed up in South Ossetia just a week before Biden arrived in Georgia, to demonstrate Russia's presence inside what used to be Georgia. There was also a strong message from Moscow during Biden's trip warning against any military aid to Georgia. Are the Russians really worried that the United States may do something that might provoke them?

The Russians, since last August, had a very sharp rhetorical stance against Georgia and against Saakashvili in particular. But it seems to me that if they look at how the United States has engaged with Georgia since the conflict, there was passage of a major assistance program, but that assistance has been primarily on economic recovery and such.

Certainly I suspect that the administration is going to have a military-to-military relationship with Georgia, but I don't think providing weapons to Georgia is high on anybody's priority list in the United States. And the simple fact is that there's no conceivable defense assistance program the United States could do with Georgia that would give the Georgians the ability to defend themselves against Russia, to say nothing of trying to take back South Ossetia or Abkhazia.

In fact, in his speech to the Georgian parliament , Biden said specifically: "It is a sad certainty, but it is true there is no military option to reintegration, only peaceful and prosperous Georgia--a peaceful and prosperous Georgia that has the prospect of restoring your territorial integrity by showing those in Abkhazia and South Ossetia a Georgia where they can be free and their communities can flourish."

QUESTION: You did a report for the Council on Foreign Relations, "Averting Crisis in Ukraine," in which you pointed out some of the danger possibilities. What is the situation now?

My read now is that the one crisis possibility out there that is real is another gas conflict. It's a possibility because, due to the weakness in the energy sector in Ukraine, the country is perpetually in danger of missing payments. In fact, Ukraine is technically in default on the gas contract it signed in January because it hasn't bought the minimum amount of natural gas that it contracted to buy. Russian Prime Minister Vladimir Putin has said they won't push that point, but the Russians haven't amended the contract.

So Ukraine is still in technical default. And there are suspicions that the Russians may look for an opportunity in the fall or early winter to again apply some pressure on the gas side with a view of having an impact on Ukraine's internal politics. So there's that concern. The other concern that I wrote about in January between Ukraine and Russia is that somehow they might get into a conflict over Crimea. My sense is that the probability of that is declining now.

LINK: http://www.cfr.org/publication/19906/delivering_tough_love_to_ukra

NOTE:  Former U.S. Ambassador to Ukraine, Steven Pifer, serves as a Senior Advisor to the U.S.-Ukraine Business Council (USUBC), Washington, D.C., www.usubc.org.