A New Year’s Resolution to Russian Sanctions?

Stratfor 03-Jan-17

Geopolitical Diary

Despite high hopes in Moscow for economic relief, the future of sanctions against Russia remains unclear. Visiting Georgia on Monday during a tour of Russia’s borderlands, U.S. Sen. John McCain promised a bipartisan push in Congress to expand punitive measures against Moscow over the next few weeks. Just a few days earlier, President Barack Obama slapped sanctions on Russian intelligence services for their alleged role in meddling in the U.S. presidential election in November. But politicians in the United States are far from united on the issue. President-elect Donald Trump has pledged to reshape Washington’s relationship with Moscow once he assumes office Jan. 20, an effort that could lead to eased sanctions.

The European Union is equally divided over the future of its own sanctions regime against Russia. Though the Continental bloc recently voted to extend the measures, the EU program will come under increased scrutiny as its July 31 expiration date draws near and member states debate whether to revise their policy toward Moscow. Sebastian Kurz, Austria’s foreign affairs minister who headed to eastern Ukraine on Tuesday as the new chairman of the Organization for Security and Co-operation in Europe, said in a recent interview that his country will push to gradually lift the sanctions against Russia. Still, the growing divisions in the West over the issue do not spell an immediate end to the sanctions regimes.

Among EU members, sanctions against Russia have been controversial from the start. Member states such as Austria, Italy, Greece and Hungary have questioned the measures’ efficacy, arguing that they hurt EU businesses in Russia without necessarily improving the situation in eastern Ukraine. The governments in these countries insist that to resolve the Ukrainian conflict, the European Union must establish a rapport with Moscow rather than punish it. Even so, dissenting member states have sided with the rest of the bloc when voting to impose or extend sanctions, which must be approved unanimously. Facing pressure from political and economic powers such as Germany and the United States, and reluctant to legitimize Russia’s annexation of Crimea, these countries have steadfastly upheld the measures. As the next EU vote on the issue approaches, Germany will probably try to preserve the sanctions. But without Washington at its side, Berlin’s influence may not be enough to sway opposing EU countries to keep them in place. Furthermore, two of Russia’s most adamant critics in the European Union — the United Kingdom and Poland — will have less clout in the bloc over the next year thanks to the Brexit vote and Warsaw’s controversial domestic policies.

At the same time, France may prove a valuable ally in Austria’s efforts to progressively lift the sanctions against Moscow after its presidential elections in April and May. The main contenders for France’s presidency, representing the center-right and far-right, both support improving the European Union’s ties with Moscow, ostensibly for economic reasons. (Business organizations in the country have been lobbying for an end to the measures.) But there are also deeper ideological and geopolitical calculations at play: French conservatives want to return to a Gaullist foreign policy in which Paris is as independent as possible and strikes a balance between Russia and the West. From this point of view, the current Socialist administration has been too Atlanticist. The far right, meanwhile, wants France to be a fully sovereign country that does not have to acquiesce to the European Union’s foreign policy decisions. French nationalists also have an ideological affinity with Russia, which they see as a beacon of nationalist and Christian values.

Nonetheless, France is unlikely to implement a dramatic change in its current foreign policy, especially if the conservatives win the election, as most opinion polls suggest. Negotiating with Russia is not the same as endorsing its annexation of Crimea, and calls for a rapprochement with Moscow do not imply removing sanctions without getting something in return. More important, France will not jeopardize its relationship with Germany over the sanctions issue, particularly since Paris and Berlin face larger battles on the horizon. France will probably advocate lifting sanctions gradually in exchange for modest progress in eastern Ukraine instead of demanding a complete and immediate end to the system of punitive measures.

This approach could gain support from many of the governments that disagree with the sanctions but understand that they are unlikely to be abolished anytime soon. Poland and the Baltic states, on the other hand, will resist changes to the sanctions regime, though they may eventually be outnumbered. Germany and France will probably focus on increasing EU cooperation on defense and security to reassure member states at the bloc’s eastern border. EU sanctions against Russia will probably remain in place during the first half of the year, but the debate over their future will intensify as their expiration date draws closer.

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