Welcome to European Tribune. It's gone a bit quiet around here these days, but it's still going.
Here is one vote for simply ignoring and staying out of Russia.

Let's start with the basics: the idea that Russia constitutes some sort of threat to Europe/USA or vice versa is absurd. The mini-conflicts Russia has with its neighbours are driven by internal politics, Chechnya was nothing but a Putin election drive to give the most worrying example.

The recent Estonian - Russian posturing was for domestic audience, at both sides. Georgia pretty much the same thing.

Economically and politically, the Russians make their own problems and there is very little we can do about it, and I doubt whether we should we even try.

As an example, the recent row with Finland and Sweden about forest exports. Russians say that exporting wood to Finland/Sweden that is then refined into products like paper is colonial. Maybe so. And now Russians are to impose export tariffs, the idea being that then forest companies would build factories in Russia and would export paper and other products instead of raw materials.

The problem with this idea is that pulp factories are multi-billion long term investments that require a lot of infrastructure. Which is the reason why there isn't a rush to build them in Russia, no infrastructure, dubious property rights, etc. The risk premiums such investments would entail are just not there, especially given overprodcution of said products in Europe as it is, and these are highly automated facilities so lower labor costs are not that big a saving. That Russians don't have much of a forest industry is entirely their own doing.

All the tariffs will do is effectively devalue a natural resource making Russian forests less valuable, and cost thousands of jobs at the Russian side. A Finnish politician was stupid enough to say this out aloud, which the Russian press then spinned as a threat that Finns will kill the livelyhood of Russian lumberjacks and truckers.

BTW, some sort of trade war between Finland, maybe Sweden and Russia seems likely. NordStream gas pipeline could be the victim of it.

By all means, let's trade gas and whatever with Russia. But the Russians are simply too paranoid about western co-operation to make it work, growing the mutual dependence of Europe and Russia is asking for trouble.

Still, wind farms in Kola Peninsula are a very attractive idea. Maybe in some other decade.

by teme on Mon Aug 18th, 2008 at 03:50:56 AM EST

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