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Gas Geopolitics
By Alexei Makarkin, deputy director general of the Center for Political Technologies.

MOSCOW (RIA Novosti) Dec.27 --  Gas prices have become the central issue in relations between post-Soviet countries. Ukraine, Georgia and Moldova, which recently set up the Union of Democratic Choice (UDC), a geopolitical alternative to Russia, are all consumers of Russian gas.

Until now Russia tried to preserve subsidies for its CIS partners, believing that this way it will keep them within its orbit. The dubious results of this policy became evident long ago.


Presidents of Ukraine Victor Yushchenko
and of Georgia, Mikheil Saakashvili.

MOLDOVA and GEORGIA

Moldovan Communists began their rule with pro-Russian rhetoric and announcing plans to give the Russian language official status. Later, however, they appealed to the West seeking to abandon the so-called Kozak plan of the Transdnestr settlement, which, by the way, envisaged the official status for Russian.

In the past, Ukraine, Georgia and Moldova often maneuvered between Russia and the West, but now their geopolitical priorities have been determined clearly. The governments and most elites in these countries are openly pro-Western, although still mentioning the need to develop relations with Russia. In Georgia parliamentary opposition criticizes Russia even more harshly than the Mikhail Saakashvili government.

Observers were surprised to learn that Gazprom will raise the gas price from $63 to $110 per 1,000 cu m for Georgia and from $50 to $230 for Ukraine. The difference is too great to be accidental. The fact is that Russia is pursuing two aims at once. The first one is to raise Gazprom's earnings, as it is one of the biggest contributors to the country's budget. The other is to try to establish control over gas pipelines in the countries in question.

Russia is sending a signal that if it gets the pipeline, the gas price set now will remain stable for a long time. Apparently, there is a chance that at the next talks economic considerations will prevail over Tbilisi's political ambitions. If, however, this does not happen, Russia is likely to raise gas prices once again.

UKRAINE

The situation in Ukraine is different. The agreement on joint management of its gas transportation network was reached in 2002, when the parties announced the creation of a Russian-Ukrainian consortium, which was also to involve Germany. But it was not implemented under Kuchma, and was discarded under Yushchenko. It resulted in the shockingly tough stance adopted by Russia, which had been disappointed by usual protracted talks and decided to escalate the situation in order to force Ukraine to change its view on the consortium.

This means that Russia is not trying to settle the score with its geopolitical opponents, but is being very pragmatic (while differentiating between them), in an attempt to support its own economic expansion in former Soviet republics, using all available leverages.

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Comment cross-posted from my diary ::
EU Gas Import to be Cut? Ukraine Politics, Jobs, Fees, Pipeline & Ecology ◊ Oui @BooTrib

"Treason doth never prosper: what's the reason?
For if it prosper, none dare call it treason."

▼ ▼ ▼ MY DIARY

'Sapere aude'

by Oui (Oui) on Sun Jan 1st, 2006 at 06:35:02 AM EST

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