The Russian Effect on Crimea

Thanks to Michael Jennings for forwarding me this story:

A man died and a woman ended up in a hospital in separate incidents in the line for the ferry between the Krasnodar region and the recently annexed Crimea over the weekend, local news website Kerch.FM reported.

The woman sustained a head injury Saturday after being attacked by other passengers for allegedly attempting to jump the line for the ferry back to the Krasnodar region, the website reported. In recent days, people have spent up to 40 hours in the line for the ferry service. Another man died from a heart attack after spending hours waiting to board a ferry to Crimea.

After border control was imposed between Crimea and Ukraine following Russia’s annexation of the peninsula last March, most Russian tourists and visitors to the popular summer tourist destination have started taking the ferry there instead of driving through conflict-torn eastern Ukraine. There is no border control for the ferry service.

Thousands of car passengers have been waiting in line for days to board ferries traveling in both directions. According to the website of the local transportation authority, the ferries transported 3,897 cars Saturday, of which 1,689 were traveling in the direction of Crimea.

In any normal country, the ferry operators would have anticipated the increased demand and brought in additional vessels, or switched to vessels of a higher capacity.  But in Russia, either the operators don’t give a shit or any attempt to procure additional vessels would get bogged down in a quagmire of bureaucracy and graft.

Following the annexation of Crimea, which is not connected by land to Russia, President Vladimir Putin pledged to build a bridge to link the peninsula with the rest of the country. In June the state-run road construction and maintenance company Avtodor estimated the cost of the 19-kilometer bridge at up to 376.5 billion rubles ($10.4 billion) and said it would take at least four years to build.

At 19km this bridge is roughly the same length as the Incheon Bridge in Korea.  According to the irrefutable Wikipedia, this cost about $2.7bn – double the projected cost – when it was completed in 2009.  At $10bn this bridge to the Crimea is already looking way overpriced, and given it looks as though they’re going to pass on a competitive bidding process in favour of handing the job straight to a mate in a state-run company, we can expect this figure to double or triple.  In fact, it looks to me like a continuation of the Sochi Olympic scam, which saw billions of dollars transferred from the state coffers into the pockets of favoured individuals via opaque construction contracts.  Those regions of Russia which are seeing earmarked funds diverted to Crimea might not be too impressed.

Two million visitors had traveled to Crimea this year as of Aug. 11, according to the region’s Tourism and Resorts Ministry. The government agency predicted the figure would reach 3 million by year-end. Last year 5.9 million tourists visited Crimea, according to the same agency.

I wonder how many of those 2m visitors were genuine tourists, and not merely servicemen, security personnel, and government bureaucrats arriving to take over the running of the place?  And of those genuine tourists, I wonder how many of them went there having been strong-armed into going by their employer:

As we talk, I gradually sense this young couple may be here not entirely through their own choice.

Word on the beach is that there is a new type of Russian tourist in Crimea. Since the crisis erupted in Ukraine, up to four million Russians who work for the state have been effectively banned from leaving the country – it’s rumoured that the government views holidays abroad as a security risk in their case. Since Sergei is an Interior Ministry official, I ask if he can still go holiday wherever he likes.

“If you are talking about money then yes,” he says. “But… we have certain restrictions connected to my job. So you see if we have to come here, we’re very happy with that too.” When I ask if he is forbidden to travel he says nothing and finally says that it’s “not recommended”.

But would you be punished for a holiday abroad, I persist? Another long pause. “I haven’t tried it,” he laughs.

Deadly queues for ferries, a wildly overpriced bridge, and a gaggle of tourists there under duress.  This annexation has gotten off to a flying start.


Crimea’s Water

Assuming the BBC hasn’t made a hash of it by making its usual basic factual errors, this is a fairly interesting article:

Russian officials say a water shortage in Crimea is threatening to become acute as Ukraine has reduced the supply via a key canal.

The North Crimea Canal delivers water to Crimea from the River Dnieper, in Ukraine’s southern Kherson region. The canal accounts for 80% of Crimea’s water.

_74442504_crimea_water_supply_624map2One or two of my regular readers had mentioned Crimea’s water supply as being critical earlier, and I’m surprised it’s not being talked about more.  I’m also surprised that Ukraine hasn’t cut the supply off altogether, or at least threatened to:

The canal authorities in Ukraine say Crimea has accumulated a huge debt for water supplied last year. The dispute is aggravated by the breakdown in relations between Kiev and Moscow.

Perhaps the government in Kiev are using this as leverage to prevent the Russians cutting off the gas supplies, as they are threatening to do?  Turn off the gas, and the Crimea goes thirsty.  In this regard, Ukraine has the seasons on its side:

Crimea’s harvest of grapes, rice, maize and soya will be ruined if it does not get more water soon, officials say.

The current water shortage is threatening 120,000 hectares (296,000 acres) of Crimea’s crops, which rely on irrigation, Russian Agriculture Minister Nikolai Fedorov said.

A ruined harvest across that area would mean losses of up to 5bn roubles (£83m; $140m), he told the news website.

Although I have an inkling that the long-term prospects of Crimea’s farmers are not going to be that rosy anyway: their main local market will soon be harder to reach:

Russia says the Crimea-Ukraine border is now officially a state border.

The Russian government plans to establish permanent checkpoints there, as well as new rules for entering or leaving Crimea, Ria Novosti news agency reports.

With all the inefficiency, bureaucracy, and corruption that accompanies a Russian-controlled border anywhere, this cannot be good for those who previously would have driven their produce straight to Kiev overnight.  It has now become a lot harder to reach a major population centre, of which there are none in the Crimea itself.

Of course, I think there are valid reasons why Ukraine didn’t retaliate by switching off the water to the Crimea.  It might well have been used by Putin as an excuse for a full-scale invasion, or to switch the gas off.  But more a more likely explanation is that the government in Kiev is incapable of making bold decisions and/or doesn’t want to be seen by the west to be deliberately inflicting hardship on a civilian population, some of which still consider themselves Ukrainian.  Or if they’re really smart, they’ll realise that a gradual lack of funding and effort in maintaining and operating the canal system to the Crimea will put the squeeze on the Russians anyway:

A BBC reporter in Crimea recently said the water supply was one of the chief concerns of local people, ahead of the controversial March referendum on joining Russia.

To deal with the shortage, new wells could be dug or water could be brought in from Russia, but such options are expensive, officials warn.

Indeed.  As I said before, I think the annexation of Crimea could turn out to be a very expensive welfare project for Russia, with little tangible benefit.

But there’s a more important point to be made here.  I’ve always thought that Putin was a master at playing a strong hand very badly; his country could have been much richer and interacted more favourably with the rest of the world had he left his ego, and those of the electorate, at the door.  But on this occasion it’s actually the opposite: he’s played a weak hand very well, albeit against an opposition who is hapless (Obama) and compromised (Germany).  The problem is that he doesn’t realise his hand was weak, he probably thinks – along with most Russians – that he has pulled off a military coup which puts him up there with Napolean and Spartacus in the ranks of military geniuses.  Now how many military geniuses of yore would have annexed a peninsula whose water supply lies in the hands of the enemy?  Exactly.  I’d not be surprised if Putin and his army had no idea where Crimea’s water supply came from until the annexation was complete and the Crimean “leader” was banging at the Kremlin door asking for a few billion roubles worth of infrastructure.

But it’s the non-response from the west that is most dangerous, because it will have convinced Putin that his hand is much stronger than it is, that he actually is some kind of Machiavellian genius, and that the west will continue to grumble but otherwise do nothing.  In such circumstances the potential for a miscaculation is enormous, and should this whole situation escalate it will likely be because Putin crosses a line in eastern Ukraine that nobody told him was there.  Putin’s not a complete idiot, he just thinks he’s smarter than he is, but leaving him to judge for himself exactly how far he can go before the west is compelled to intervene is a very dangerous game indeed.  Both sides could end up dragged into a nasty confrontation over an incident which would never have taken place had the Russians known what the stakes were.  At the moment, the Russians don’t know the stakes, and we’re leaving them to guess.  This is stupidly and unnecessarily dangerous.

As a final thought, I’ll say on here what I said in the comments of another blog.  Incredible though it is to believe, the current crop of western politicians have – via Syria, Libya, Ukraine, and others – managed to make George W. Bush look like one of the finest statesmen of his generation.  This alone is quite some achievement.


Kerch Strait Bridge

Well there I was assuming that there was a bridge between Russia and the Crimea all this time, when I discover that there is nothing of the sort!  Although one has been planned for some time, apparently a slow ferry is all that connects Crimea to the country that just annexed it.  Some thoughts:

1) How the hell did Ukraine manage to let Russia put troops into Crimea when there is no bridge?  Such piss-poor defending makes them almost deserve to lose a province or two.

2) If for whatever reason there is no free-flow of people and goods between Ukraine and Russian-controlled Crimea, how pissed off is the population going to be relying on crappy old ferries to get off their peninsular peninsula?

3) How long do you think we’ll be waiting for the bridge to be built?  Yes, I know Putin promised he would accelerate its construction the day the Crimean accession was signed, but in Russia large state projects have a habit of being delivered late, poorly, and way over budget.

Once the dust has settled it’ll be interesting to see what life is like for those Russians stranded in Crimea.  I wonder if Putin would recognise any future referendum to see them leave?


On Russia’s Annexation of Crimea

Russia’s annexation of the Crimea – which is exactly what it is – has taken everybody by surprise, even those who took note of Russia’s actions against Georgia over South Ossetia and Abkhazia in 2008.  Russia has always coveted the return of the Crimea, and with good reason consider Khrushchev’s gift of the region to the Ukraine in the 1950s to be somewhat of a historical injustice, but few expected Russia to move so boldly and so swiftly.

Of course, in hindsight, it’s easy to see how this happened.  With Russia’s economy failing to deliver the promised increase in living standards for ordinary Russians (the standards are improving, but too slowly, and vital reforms remain as distant as ever) and the population becoming increasingly weary with the seemingly indefinite presence of Putin and his gang of bent oligarchs, this was too good an opportunity to pass up: nothing rallies the Russian population in support of their government more than an overt display of military might, with the possible exception of sticking two fingers up to the United States over any issue you can imagine.  Also, I think Putin does genuinely believe that Crimea should belong to Russia and that the interests of Russia are best served by this annexation.  Even if he wasn’t in need of shoring up his own popularity ratings, I think he would have taken this opportunity.

When you couple this with the fact that the Americans have a complete pansy in the White House, interested in himself, his image, and nothing else; plus a Europe led (and I use that term loosely) by a divided and war-weary Britain, a Germany whose commercial ties to Russia have already seen a former Chancellor go to work for the Russian government the morning after his resignation, and a France who has as much interest in Russia as they do cricket; and the fact that Putin has seen how ineffectual all parties were in dealing with the mess in Syria, and it’s easy to see why Putin took his chance.

His actions do have some precedent.  The excuse of intervening to “protect its citizens” is one that has been tried and tested, and I’m sure Putin cited this knowing full well that the Americans wouldn’t have a leg to stand on.  But rather than stop there, Putin announced that the “secession” of the Crimea is similar the secession of Kosovo from Serbia, in that the west set a precedent whereby the secession of a region did not need the approval from a country’s central authority.  Now he might have a point, but he’s relying on the fact that nobody will notice the difference between the US (and others) supporting the secession of Kosovo such that it becomes an independent state, and Russia supporting the secession of the Crimea such that it becomes part of Russia.  Putin would have been better off not making this comparison, but ever since the day he saw his paratroopers make fools of themselves by landing in Pristina airport in a futile gesture (and subsequently having to scrounge food from NATO soldiers on the other side of the fence), this has been an itch he has been desperately wanting to scratch.  A shrewd statesman would not let emotions guide his conduct, but Putin has always been a long way from the shrewd statesman he so desperately wants to be.

Regardless of the historical context of the Crimea, Putin’s decision to annex part of a neighbouring country is somewhat at odds with his earlier insistence that the Russian Federation must remain whole to the point that Grozny must be flattened and the Chechen population beaten into submission in order to drive the point home.  Would Putin uphold the principle he has applied to the Crimea if the population of Karelia held a referendum to return to Finland, or the Kuril Islands to Japan?  No, he wouldn’t, but Putin has been emboldened of late.

His greatest victory of recent times was the thwarting of western attempts to end the Syrian civil war.  Having run rings around the hapless John Kerry and Barack Obama – which is hardly difficult (for all his faults, ask yourself if this Crimean situation would have arisen with Dubya in the White House) – Russia felt it had got one over on the US and the west.  Which it had, I suppose.  But to what end?  Regardless as to whether western intervention would have been a good thing, the Syrian civil war still rages with horrific civilian casualties and will continue to do so indefinitely, and Russian interests have been advanced…well, how?  I suppose they still have their ally Bashar al-Assad in some sort of presidential role, albeit in a country that is tearing itself to pieces.  Great, that’ll pay dividends, I’m sure.  But thwarting the perceived ambitions of the west is the goal for Putin and an awful lot of Russians: as has been pointed out by dozens of commentators they play a zero-sum game whereby what is bad for the west must be good for Russia.

And thus emboldened, Putin moved to annex the Crimea.  Good for him, but now what?  On the plus side Russia has now gained a peninsula with a very picturesque southern coast which is great to visit in summer (as far as Ukraine should be mourning a loss, that’s about as far as it goes).  And they’ve gained a region filled with about two-thirds die-hard Russian loyalists and the rest who can’t stand them.  Yes, all that Russia needs now is the addition of another region divided politically and ethnically which is going to be utterly dependent on Moscow for economic support.  The Crimea is a popular tourist spot, and visitor numbers swelled following the Eurovision Song Contest in 2005 when the government lifted the visa requirements for EU visitors and removed them permanently shortly thereafter (one visitor who took advantage of this was me).  Whether obtaining a Russian visa will be necessary to take a holiday in the Crimea from now on remains to be seen, but I suspect it is likely.  Border controls between Ukraine and the now-Russian Crimea will further serve to limit tourist numbers, as will the slightest sign of civil unrest or security apparatus on the streets.

Given the importance of tourism to Crimea’s economy it will be interesting to see how the place fares this summer.  Crimea’s other industry is agriculture, and given its location I would guess that the primary market for the products is the population centres of Ukraine rather than Russia.  Slapping import restrictions on agricultural products from the Crimea is something the new government in Ukraine could do quite easily, and combined with the inevitable effect on tourism these latest developments will have, there could be tough times ahead for the Crimean population.  This will lead to Russians asking (not for the first time) what the hell they’ve gone and done, and unrest amongst the local Ukrainians and Tatars which the Russians will no doubt deal with in a heavy-handed manner, making the situation even worse.  As I said, incorporating another divided, restless, border region into the Russian Federation probably isn’t what it needs right now.

So having masterfully exploited a weakness in the Ukraine and the west for a short term gain, Russia might well now be asking what they’ve actually achieved once those waving the flags feel their arms getting tired and go home.   The status of Russia’s Black Sea fleet is now assured, but given that it never came up for discussion in over two decades of post-Soviet independence, it is hard to see this as much of a positive.  Nor is it hard to see that even with a fleet on the Black Sea, the Russian navy is still nicely locked in: with a NATO member controlling the Bosphorus, the base at Sevastopol isn’t the strategic location its made out to be.

Russia’s main problem is that they are less likely to see a Russia-friendly government in Ukraine again.  The situation before saw Ukraine with a 17.3% Russian population; using numbers from Wikipedia, I have calculated the new Ukraine (i.e. minus Crimea) to be 15.3% ethnically Russian, with a major pro-Russian region now out of the picture.  I don’t know if the remaining Russians have enough numbers or influence to ensure they are properly represented in Kiev, but its likely that things will get a lot harder for them, especially for those unfortunate enough to live in pro-western districts (they can look to the fate of Estonia’s Russians to see what awaits them).  Whatever happens, I think it is likely that the Ukraine will take a much more pro-western and anti-Russian stance for the foreseeable future, the costs of which might outweigh any benefits Russia has gained from the annexation of the Crimea.  I think it unlikely that Ukraine will be able to sort itself out and become a functioning country any time soon, but with potential EU membership there might come a time when the Russians in Crimea look somewhat enviously over the border at their Ukrainian neighbours.  I haven’t actually met any to ask, but I wonder how many Russians living in the enclave of Kaliningrad Oblast would like the freedoms of work and travel that Lithuanians enjoy?  Their economy seems to do pretty well due to its special ties with the EU, they might be asking what the benefits of remaining part of Russia are.

Another problem Putin now faces is that the US is already starting to put the squeeze on certain individuals to whom he is connected, and as the Streetwise Professor points out, things have the potential to get uncomfortable depending on how much the US and others are willing to push.  The west appears to have finally figured out that the way to exert pressure on Russia is to start meddling in the financial affairs of prominent Russians, and the companies they control, overseas.  These individuals are those on whom Putin is reliant for support, and hence cannot afford for them to be feeling too much pain as a result of his belligerence in international and regional affairs.  Such targeted sanctions are clever in that they will barely affect ordinary Russians, who will not give two hoots that certain oligarchs are having their overseas loot frozen.

That said, I don’t expect the sanctions to be applied too strongly.  For all Merkel’s tough talks, the Germans have conceded time and again to Russia on matters of principle with the aim of protecting their commercial ties, and I wouldn’t rely on Obama doing anything other than giving speeches off a teleprompter.  So in the short term it looks as though the Crimea will become Russian, the Ukraine will become less so, and the Baltic States pray that little bit harder for a Republican president to win the next US elections.  But in the medium term and longer terms, I don’t think we’ve heard the last of this.


A Frenchman Discovers Ukraine

One would think that if you are going to award a major sports tournament to a particular country, you would at least take the trouble to see what the place is like first.

Unless you’re UEFA, that is:

The president of Uefa has hit out at “bandits and crooks” for the escalation of Ukrainian hotel prices ahead of the Euro 2012 football championships.

Bandits and crooks in Ukraine?  No!!

Speaking in Lviv, one of the venues, Michel Platini said the rising cost of accommodation worried him, and called on the authorities to prevent it.

Call on the Ukrainian authorities to prevent private businesses increasing their prices?  Sorry, didn’t the Soviet Union end a couple of decades ago?

He added that some hotels were not respecting room contracts which had already been agreed.

Contracts not being respected in Ukraine?  No!!

“You can’t change (the price of a room) from 40 euros (£33; $52) to 100 and then up to 500 just like that, from one day to the other, this just is not done,” he said.

Well, yes you can and yes it is.  All the time.  Clearly monsieur Platini has never tracked hotel room prices in Yuzhno-Sakhalinsk before and after an oil and gas conference.  Even those who were already staying in the hotels were being hoofed out to make room for better-paying guests.  This is standard practice all over the former Soviet Union.  Where does Platini think he is?  Paris?  (Where, incidentally, the price of a hotel room is such that you’d think a major football tournament was there permanently.)  How dim have you got to be think this wouldn’t happen?

Mr Platini is due to open a new airport terminal in the city later with President Viktor Yanukovych.

An event at which there will of course be no crooks and bandits, oh no!  He’ll probably find half the hotel owners are in the president’s entourage.

M. Platini’s not quite figured Ukraine out yet, has he?