Kingston Conference on International Security NATO and Russia: Has the ship already sailed? Dr. Marc Ozawa, Research Division 12 June 2019 NATO DEFENSE COLLEGE
Overview Current state of NATO-Russia relations and recent 1. developments Ongoing impasse over Crimea and conflicting world 2. views Sanctions and the oil factor 3. Russo-Chinese relations 4. Implications for the North Atlantic alliance 5. NATO DEFENSE COLLEGE
NATO-Russia relations Expert group – starting point of analysis *(30 participants (practitioners and academics) from all regions of NATO plus Ukraine, Georgia and Russia – mostly professionals focused on Russian studies) Ø Impasse over Crimea Ø Low probably of Article 5 Ø Probability of more sub Article 5 aggressive activity Ø Despite deadlock NATO can play a constructive role in risk reduction, strategic awareness development among the member states and coordinating stakeholders NATO DEFENSE COLLEGE
Current state of affairs Ø Deterrence and dialogue – increased NATO presence in the Eastern Flank (EFP and NRF/VJTF) but NRC also met in January for first time in 2019 Ø Apparent end of the INF Treaty Ø Continued Russian military posturing ( Zapad and Vostok ) in the Eastern, Northern and Southern Flanks (Syria) Ø Sea of Azov/Kerch Strait Ø Election interference and information warfare Source: “Kerch Strait Incident in Detail. Analysis.,” FleetMon.com (societal destabilization) Ø Skripal case NATO DEFENSE COLLEGE
Waning effects of sanction Sanctions and the federal budget of Russia (2011-18 ) 25000 Sanctions implemented Surplus 20000 15000 (bln rub) 10000 Deficit 5000 0 2011 2012 2013 2014 2015 2016 2017 2018 Revenues 11367.65262 12855.54062 13019.93948 14496.8805 13659.24294 13460.04069 15088.91484 19454.74116 Expenditures 10925.61742 12894.98675 13342.92164 14831.57591 15620.25257 16416.44684 16420.30308 16709.27718 Source: Data from the Ministry of Finance (Russian Federation) NATO DEFENSE COLLEGE
The oil factor • Natural resource economy – ‘Petrostate’ (Goldman: 2008) Russian National Wealth Fund in (bil USD) Oil price in USD/bbl (Brent) $140 $120 $100 $80 *Courtesy of Oil Industry News 2015 $60 • IEA oil price outlook to 2020 $40 is $ 82-79/bbl (IEA: 2016) Estimated break even range $20 • Break even estimation: $45- $0 55 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 *Courtesy of Geopolitical Futures: 2015; data from EIA, Russian Ministry of Finance and Reuters NATO DEFENSE COLLEGE
Russo-Chinese relations Ø BRI presence in Russia’s near abroad Ø Power asymmetry Ø ‘Axis of convenience’ or ‘lasting strategic partnership’? Ø Russia’s ‘Pivot to the East’ – growing trade levels compared to EU Ø Power of Siberia, Yamal LNG Ø Growing trade since 2014 NATO DEFENSE COLLEGE
Russo-Chinese relations (cont.) Ø Vostok Ø Multi-level momentum in cooperation but top-down driven; question of sustainability Ø History repeating? Source: DD Wu. “Xi-Putin Meet on SCO Summit Sidelines to Strengthen China- Russia Ties.” The Diplomat . NATO DEFENSE COLLEGE
Main points Ø Policy of deterrence and dialogue continues Ø Russia’s orientation has shifted toward the East, but what this will yield in the mid to long term is still unclear Ø Russia’s economy has become more resistant to sanctions but structural problems remain Ø On going impasse over Crimea – meanwhile Russia continues military posturing and sub- Article 5 aggressive activities Ø If relations improve, it will probably result from member state initiation rather than at the NATO level NATO DEFENSE COLLEGE
Bibliography British Broadcasting Corporation, and SBS-TV Enhance-TV. Putin, Russian and the West . Enhance TV, 2012. DD Wu Diplomat The, “Xi-Putin Meet on SCO Summit Sidelines to Strengthen China-Russia Ties,” The Diplomat, accessed June 11, 2019, https://thediplomat.com/2017/06/xi-putin-meet-on-sco-summit-sidelines-to-strengthen-china-russia-ties/. ‘GDP Growth (Annual %) | Data | Table’. Accessed 18 February 2017. http://data.worldbank.org/indicator/NY.GDP.MKTP.KD.ZG?page=2. Goldman, Marshall I. Petrostate Putin, Power, and the New Russia . Oxford; New York: Oxford University Press, 2008. Hansen, Flemming Splidsboel. “Do the CIS Member States Share Foreign Policy Preferences?” Journal of Eurasian Studies 6 , no. 1 (January 1, 2015): 69–78. Non-attributed. “Russian Defense Policy Presentation.” presented at the International Week Conference, Kyiv, April 3, 2019. “Panel Discussion on Russia.” Workshop discussion, Rome, November 2, 2018. Snegovaya M. “What Factors Contribute to the Aggressive Foreign Policy of Russian Leaders?” Probl. Post-Communism Problems of Post- Communism , 2019. ‘Transparency International - Russia’. Accessed 19 February 2017. https://www.transparency.org/country/RUS. Ozawa, Marc. “NATO and Russia: Has the ship already sailed?” Unpublished manuscript drawing on Roman Banya workshop at the NATO Defense College, Rome, 2019. “World Energy Outlook 2018.” WEO . Paris: International Energy Agency, 2018. “Гость Максим Орешкин. Познер. Выпуск От 05.03.2018.” Accessed May 31, 2019. https://www.1tv.ru/shows/pozner/vypuski/gost-maksim- oreshkin-pozner-vypusk-ot-05-03-2018. “Минфин России :: Федеральный Бюджет.” Accessed February 27, 2019. https://www.minfin.ru/ru/statistics/fedbud/. ‘Одобрение Органов Власти’. Accessed 19 February 2017. http://www.levada.ru/indikatory/odobrenie-organov-vlasti/. ‘Совещание По Экономическим Вопросам’. Президент России . Accessed 18 February 2017. http://kremlin.ru/events/president/news/53889. NATO DEFENSE COLLEGE
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