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24th Oct 2020

G8 opening sets tone for new chapter in EU-Russia relations

More trust in Russia's statements of good faith on energy and toleration of its growing authoritarianism are emerging as features of the EU's new Russia policy, as the G8 clique settles down for two days of talks in St Petersburg.

"Europe's first priority is an open and transparent energy market. In practice, this means open access to all parties so long as they play by the rules," European Commission president Jose Barroso said shortly after landing on Saturday (15 July).

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"Of course I trust [Russian president] Mr Putin. That he is someone who in making a deal, will respect that deal," he added, with the draft G8 energy agreement set to open up Russian purchases of EU energy distributors in return for EU purchases of Russian oil and gas pipelines.

"We will work to reduce barriers to energy investment and trade. It is especially important that companies from energy producing and consuming countries can invest in and acquire upstream and downstream assets internationally in a mutually beneficial way," the draft text says, Reuters reports.

Asked if European consumers might one day get gas bills printed with the Gazprom logo, Finnish EU president Matti Vanhannen said "One Finnish [energy] company is already totally owned by a Russian company. Don't be afraid of that kind of normal business."

G8 conclusions are not legally binding, but any gentlemen's agreement here will set the broad political direction for more detailed future contracts, with the EU currently drafting a new energy and security pact with Russia for 2007 and beyond.

US-Russia relations are also moving in the same direction, with president George Bush and Mr Putin unveiling plans to create a closed club of nuclear fuel suppliers who will sell enriched uranium to an increasing number of nuclear energy producers around the world.

The enriched uranium monopoly is to include other existing fuel producers and have UN oversight, with the aim of keeping enrichment technology – which can be used to make bombs – fenced off.

Trust not shared

The EU leaders' new friendliness toward Russia is not shared by many EU citizens however, with an FT survey on Friday showing that just 20 percent of people answered "yes" to the question "can the EU trust Vladimir Putin?"

New member states are also unwilling to accept Russian pledges to play by market economy rules if its state-owned oil and gas giants enter Europe, with former Lithuanian president Vytautas Landsbergis recently saying "No Russian official statement of assurance is reliable."

"No matter what they say at G8, the reality of EU-Russia energy relations is that they have gas and we need it," an EU diplomat told EUobserver last week. "Imagine a man sitting with his hand on the [gas] tap and asking the EU – what's your policy on Chechnya? I see. What's your policy on Georgia?"

Softly, softly

The EU elite's soft language on Russia's tightening grip on free speech and the voting system was also apparent in St Petersburg, despite pre-G8 arrests of dozens of would-be protestors – including two German reporters - on "public urination" charges.

On Friday night, barely 100 people made it to a stadium several kilometres away from the G8 venue set aside for anti-G8 demonstrators. On Saturday a few hundred-strong communist march through the centre of St Petersburg was broken up by police.

"Russian democratic practice leaves room for improvements," Finland's Mr Vanhannen said, with western journalists forcing pro-democracy comments from leaders keen to keep the agenda on energy and terrorism. Mr Barroso referred to the G8 countries as "the world's democracies" without blinking.

The US' Mr Bush also seemed keen to make up for vice president Dick Cheney's anti-Russian Vilnius speech in May, saying "there will be a Russian-style democracy…[Mr Putin] doesn't want anybody telling him how to run his government. He was elected."

Regal mystique

With oil at $78 a barrel pouring cash into the Kremlin's coffers and with the assassination of Chechen rebel Shamil Basayev on the G8-eve, Mr Putin enjoys wide domestic support as a strongman leading the country out of its degraded 1990s state.

The G8 images - broadcast by the 4,000 journalists covering the event - of Mr Putin hosting world leaders and their wives in the Tsarist-era splendour of the Constantine Palace are adding to the mystique.

European Renaissance monarchs also knew how to put on a good show in summits such as the 1520 Field of the Cloth of Gold in France, but today's EU meetings at the drab Justus Lipsius building in Brussels are fairly humdrum affairs.

The G8 2006 summit is already delivering its message - that Putin's Russia is back, virile and ascendant in contrast to the internally-divided European Union courting its energy favours. "This is not an EU event," one Russian diplomat said.

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