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JOINT COMMITTEE ON EUROPEAN AFFAIRS debate -
Wednesday, 31 May 2006

EU-Russian Relations: Presentation.

I remind members to ensure their mobile telephones are switched off. No apologies have been received.

The first item on the agenda is EU-Russian relations, a presentation by Professor Ron Hill of the department of political science, Trinity College, Dublin. This is a discussion on EU-Russian relations. I welcome Professor Hill, whose presentation has been circulated to members. While members of the committee have absolute privilege, the same privilege does not apply to witnesses appearing before the committee. Members are reminded of the parliamentary practice that members should not comment on, criticise or make charges against any person outside the Houses or an official either by name or in such as way as to make him or her identifiable.

The format is simple. I ask Professor Hill to make a short presentation and I will then open the meeting to the members. Some of us recently visited Estonia, where relations with Russia were to the fore. It was readily apparent from our meetings that issues pertaining to Russia were important to that country. Members have made it clear that they would like to investigate the burgeoning relationship between the EU and Russia and that is the purpose of today's meeting. These are uncharted waters for us and we would like to hear Professor Hill's perspective and ask questions. I thank him for attending.

Professor Ron Hill

I thank the Chairman and I welcome this opportunity to give my views on a country that I first visited in 1967 and have been studying since 1961 when I went to Leeds University to study the Russian language. As Harry Moore would say, I have been doing it for more years than I care to remember. My purpose is not to attack or defend Russia or the EU's policies towards it. There is more collaboration than ever before between the EU and the former Soviet Union, including Russia, its largest member. Looking at websites, one can see that Russia participates in many international bodies that connect the EU and its new neighbours at many different levels. The relationship is less warm than many people hoped for after the collapse of the former Soviet Union 12 years ago. This is a neighbour with a complex historical relationship with Europe and conflicting attitudes towards Islam. Russia must be seen in many dimensions, as the European power it has always aspired to be and an Asian power.

When Mikhail Gorbachev was travelling through Europe he referred to a common European home but when he went to Vladivostok, China or Japan he referred to a common Asian home. It is an Asian power and still has realistic aspirations towards being a world power. It is the largest state and the former leader of the communist movement. This gave Russia its identity in the Soviet period. In losing the Soviet Union it lost much of its empire. We tend to view post-Soviet Russia as ex-communist. There are continuities but experts in the West have failed to fully explore the extent to which Soviet Union was a continuation of Russia. It is comparable with Britain, which Dean Acheson described as having lost an empire and not yet found a role.

Russia is struggling to come to terms with its reduced circumstances and is determined its circumstances will not be further reduced. It seeks to restore some of the prestige, authority, influence and power it enjoyed. The leader of the Liberal Democratic Party, Vladimir Zhirinovsky, used to point at maps and identify areas Russia would reclaim. In his more adventurous moments he pointed to Alaska, which was part of the Russian empire until 1867 when it was sold to the United States for 2 cents per acre. One can imagine what the history of the world would look like in the 20th century if the czar had not been in financial difficulty.

Russia is a nation in distress, partly because of mismanagement of the dash for growth during the Soviet period. This is characteristic of what Stalin called socialism, followed by what Brezhnev called developed socialism. The consequences are high mortality, lower life expectancy and a declining population, particularly in the past few years. This situation, which President Putin has announced measures to counter, will put greater pressure on Russian pensions than Ireland will suffer with its pension problems. Other consequences include higher morbidity rates, illness, poor health care, severe environmental degradation, including water and air pollution, soil erosion, and problems of managing over 100 ethnic groups, some of whom are traditionally hostile to Russians and other groups. Chechnya is the most cogent example of this.

Crime became endemic as Soviet authority collapsed. We are led to believe that members of the mafia have come to Ireland from Russia and other parts of the former Soviet Union. Infrastructure, including roads, buildings, housing stock and telecommunications, is in poor condition because of low standards of design and construction and poor quality materials. Mayor Yuri Luzhkov is spending enormous sums of money in Moscow but its vast hinterland awaits the modernisation of what is still the largest country in the world. This will require major investment and take considerable time.

As a European power, Russia is a near neighbour of the EU and a direct neighbour of Estonia, Poland and Lithuania. The EU border with Russia increased substantially after enlargement two years ago. For those who aspire to EU membership, such as Romania, Bulgaria, Ukraine, Moldova, Georgia and Armenia, Russia is a hegemon of recent memory and an oppressive power. For Poland and the Baltic states, it is the latest version of a country that incorporated them two centuries ago, long before the communist revolution in 1917. It retained those states within its sphere of influence until the past decade.

In the West, we must overcome a legacy of antipathy and suspicion towards the former Soviet Union and Russia. In coming to terms with post-Soviet Russia we must bear in mind that Russia is still not a liberal democracy. It never has been and may never be. Despite what Francis Fukuyama stated 15 years ago, we have not reached the end of history with the liberal, democratic market economy. Russia has some democratic procedures, particularly elections that are deemed to be free and fair, although Tartarstan is more authoritarian and less democratic. Certain features of democracy are absent in Russia, such as effective party competition or a party system. The party of power reformulates itself just before an election and usually wins. There is no tradition of open public debate and many in the West have commented on state control of television and the press. An authoritarian political culture imbues politicians and the population with a sense that people expect the Government to tell them what to do. There is a fear deep in the Russian psyche that the country will fragment further, which partly explains policies in Chechnya.

The West can consider what it could do to help democracy. If a system of democracy existed in Russia, with curbs on the political power of politicians, the Government and the President, it could be seen as less threatening. It has been Europe's policy to try to engage with Russia over the decades but this may not be sufficient. Russia could assist us in dealing with the last dictatorship in Europe, Belarus under Alexander Lukashenko.

However we answer these questions, Russia's future does not necessarily lie with a European orientation. As Europeans we are interested in the aspect that faces us but most of Russia is in Asia. Russia is not far from Alaska, formerly part of its empire, and also had colonies in California in the 1840s. The majority of the population lives in Europe but most of the country and its wealth are in Asia. For the past 20 years European Russia has been in decline. Its population is not reproducing enough and economic resources are becoming depleted. In European Russia, industrialisation and over-exploitation have had a heavy environmental impact that must be overcome.

Russia's relationship with Asia is rather different. In 1878, after the Congress of Berlin, Bismarck said that Russia should stay out of European affairs because there she only contracted nihilism and other diseases. He also stated that her mission lay in Asia because there she stood for civilisation. There have been many periods when western Europe has had a strong influence on Russian ideas. Russia regards itself as part of western civilisation, although not wholly part, and in that sense the Soviet Union, in taking European values to central Asia and elsewhere, was westernising that part of the world.

Let us consider the distribution of resources. Siberia has enormous wealth. Some former Soviet republics such as Kazakhstan, Tajikistan and Azerbaijan have oil and other resources that the world needs and those countries are still regarded by Russia as potentially, if not actually, within its sphere of influence. A few years ago there was a Shanghai co-operation agreement including Russia, China, Kazakhstan and others. Russia still has close relationships with central Asia, and closer relations with China. Relations with Japan are more problematic but India traditionally had warm relations with the Soviet Union. Central Asia, China, Japan, Korea and perhaps even India are closer to the wealth of Siberia than European Russia. Siberia is far away and European Russia is remote from it.

In the longer term, perhaps 30 or 50 years hence, there may well be political changes, with a new generation in China. Legal changes might allow Chinese or Japanese corporations to acquire resources in Siberia and, therefore, gain control of Russian assets. That could bring about a seismic change in the global economy. Siberian resources, Japanese technology and capital, Chinese labour, Korean ingenuity and perhaps also western inventiveness could lead to an economic boom to supply the Asian market of billions, including the Indian subcontinent and markets across the Pacific in what we were told ten or 15 years ago would be the century of the Pacific. Europe would become largely irrelevant to Russian ambitions. However, we must still deal with Russia right now and I suppose that the committee is interested in that.

I thank Professor Hill. I get the impression, which must be clear to anyone watching the news, that Russia is becoming more assertive in its foreign relations. Is that good or bad? Why is it the case that Mr. Putin and his Government are becoming more assertive generally?

Professor Hill

There are several issues, one being that Russians have a sense of inferiority towards the west in general. When Solzhenitsyn came to the west in 1974, he said that they worshipped the west. From my contacts with Russians over many years, it seems that they have an inferiority complex that people have blamed on the Government. They say that Russia should be the richest country in the world in light of its resources, population and everything else. However, it is among the poorest. There is a reaction to that and a feeling that Russia must not be subordinated to the west. They do not like the west lecturing Russia on anything whatsoever, including democracy, civil rights and all the other things for which the west, following the conservative swing in the late 1970s and early 1980s, has constantly attacked it.

There is a sense that the collapse of the Soviet Union was a failure. Russians lost a fairly large part of the empire that their forefathers had built up over many decades and generations. There is a feeling that stability is coming into Russia but that what is needed to bring about the transformation from the chaos of the 1990s and the first year or two of this century is firmer and stronger government. A strong state is part of the Russian tradition of thinking, and a strong state that can play what it regards as its due role in the world is what President Putin is trying to achieve. Many of the Russian people would support him in that.

When it comes to deciding Russia's role, is business or politics driving it? Mr. Putin was recently described as being more of a businessman than a politician. The professor spoke of the Japanese and Koreans acquiring assets. Do the Russians know where they stand regarding their mineral assets and natural wealth? Are they trying to decide where they can best make deals? Is a debate on that matter occurring in Russia at present?

Professor Hill

That is partly the case. There is also, however, recognition of the substantially increased value of their energy assets, which gives them a tool with which to gain, both economically and politically. At the beginning of this year, we saw how gas supplies to Ukraine and elsewhere were used. It has also been said that Gazprom and the state-owned oil companies have been trying to gain control of Britain's gas distribution company Centrica. The same is true of Lithuania and other countries in the former Soviet Union. Instead of paying in cash for gas, they have been giving equity, which is another way of reasserting Russian control. There is a great deal of suspicion in some of our EU partner states that Russia, if it cannot gain political control, will use economic means to gain influence over its former allies.

I have one final question. How are we doing in comparison with the Japanese? There are some issues regarding being able to acquire those assets but surely the issue for the EU is how we are doing in comparison with the Chinese, Japanese and Koreans. Is there a diplomatic struggle in Russia regarding influence being brought to bear on the Russians in respect of how they deal with their assets?

Professor Hill

I am not sure of the answer to that but 60% of Russia's oil and gas energy exports currently go to the EU. They constitute 25% of the EU's gas and oil imports, so we are fairly vulnerable. There is recognition in the EU of a need for stability, which one hopes the Russians will understand. We have a joint interest. Russia, to develop that wealth, requires western capital and technology. Some of it is in very inhospitable terrain and, as we know, there are potentially vulnerable pipelines through Chechnya. There are many reasons that Europe and Russia need agreement, and there are EU-Russia committees to deal with precisely those kinds of issues relating to energy and various other forms of co-operation.

I thank Professor Hill for a very interesting presentation. It has brought to a head something to which we have not given enough attention in the past. The EU clearly requires a good relationship with Russia. The professor has mentioned our reliance on Russian gas and oil in particular.

We also want the Russians on our side in the fight against terrorism. Even more relevantly, we view Russia as a future market. It suits us to have good relations with Russia. However, I wonder if Europe has given enough thought to what Russia needs. The western press paints Mr. Putin as prickly and unco-operative but the more one considers it, the more one can understand why he should be that way. If one considers the matter in the context of the sort of threat the professor sees, one can see that the two blocs must become interdependent.

I could imagine Mr. Putin feeling quite threatened. I read a very good article about how the United States would feel if a large military power occupied Mexico or made a deal therewith, if its fleet was asked to leave Hawaii or if it lost the support of its Central American allies. It is similar to the manner we in the West, including Europe, the USA, and NATO in general, through US Vice President Cheney recently, have tried to convince Ukraine to join NATO. This must threaten Russia no end. It seems understandable that Mr. Putin would be unco-operative because the signs we are giving do not reflect equal partnership in a trading arrangement. I am not sure what the next step should be, but we must convince Russia that the West, including Europe and the US, is not a security threat; certainly Europe is not. We should seek to create closer relations with Russia but we seem to be moving in the other direction. It is hardly surprising that NATO is perceived as a threat by Russia and we should aim to allay these fears because it is in our own interests to do so.

Professor Hill

I agree entirely with the Senator's comments. There is no benefit to Europe in being hostile towards Russia. Americans do not have to live on the same continent as us alongside Russia which was an issue even when the Soviet Union existed. I am not sure how threatening the Soviet Union was after the Second World War but that generation of Europeans deemed it a threat and over the years things happened that did not allay those fears, particularly the Berlin Wall and various other crises.

In 1992-93, under President Boris Yeltsin and the first post-Soviet Foreign Minister, Andrey Kozyrev, Russia was very pro-Western and the hope in the West generally was that this indicated an acceptance of Western values, hook, line and sinker, without really understanding the nature of Russia. I complain, and it may sound like sour grapes, that those of us who were specialists on the Soviet Union were deemed irrelevant because the Soviet Union did not exist anymore. Western economists, lawyers and political scientists entered Russia prescribing Western solutions to problems that they did not understand because they knew nothing about that society. Those of us who warned that it would not be so straightforward, that Russia could not simply suddenly become part of the West, see that our views were vindicated.

Change takes place slowly and encouragement and engagement are likely to be more successful than keeping Russia at arm's length and imposing sanctions. Sanctions were imposed following the military action in Poland in 1981, all sorts of barriers came down, and little was done for Soviet-European relations. If we took the advice of some people, there would be a similar response to the situation in Chechnya, which is the most charged moral issue in the opinion of many in the West.

There are areas of contention where the West is engaged and we do not find the kind of co-operation we might expect from Russia. This applies particularly to the breakaway region of Transdniestria in Moldova, where there is a Russian garrison in the capital city of Tiraspol which should have been withdrawn by now. The Organisation for Security and Co-operation in Europe has tried to resolve this issue for 15 years without effective co-operation from Russia. Russia and Ukraine are the two countries that at least tried to guarantee the security of that region.

Another issue is Russia's attitude towards any country that looks like it favours western-style policies. In Belarus, Russia is clearly supporting Lukashenko, despite him and Putin, apparently, not getting along. That is potentially a threat, perhaps to Russia, and certainly to the neighbours of Belarus. We do not get co-operation in some fora where Russia feels it has a particular interest, for example, the former Soviet republics that it considers within its sphere of influence. When these states look to the West and receive encouragement, Russia is not too pleased. We must not assume that we can identify what Russia's interests are. Russia can define its own interests and we must work with Russia to ensure its interests do not encroach on ours. We need to find as many areas of co-operation as possible along with our partners in Eastern Europe.

Since the European Union enlargement of 1 May 2004 there are now at our disposal people in leading positions, politicians and administrators, who know how to deal with that part of the world because they were part of it. A couple of years ago I spoke to Prime Minister AlgirdasBrazauskas of Lithuania on the subject of Belarus when he visited Dublin. He said he knew President Lukashenko, that they could chat, drink, joke and curse together. If the EU used that kind of experience and personal contact, not necessarily openly, while it is still available, it may find ways to influence Belarus — even operating through Russia or friendly countries, such as Ukraine, to deal with some of the issues that are a stumbling block between Russia and the EU. There may be ways in which individual members of the EU, including ourselves, could have influence where the bigger powers or the European Commission might not.

While Russia will perhaps never apply for EU membership, can one contrast our behaviour towards Turkey with that towards Russia? I acknowledge that it is hoped to coax Turkey into the EU but the behaviour towards these countries seems to be entirely different. It is in our own interests to approach Russia in a more friendly manner.

Professor Hill

Viktor Chernomyrdin, when he was Prime Minister of Russia, talked about Russia joining the European Union one day, but that is rather like the Deputy in the 1930s who said Ireland should get a slice of Africa while there was still a slice to be had. Not quite kite-flying, but somewhat fanciful, I think.

The Senator is right. I think Europe is being pushed by the United States to allow Turkey to join the EU and Turkey would like to gain admission. I sense much hostility to such a move.

The social landscape in western Europe has been changed by the presence of many Russian speakers, including Russians. We have many Russian speakers here due to citizens of Latvia taking residence in Ireland. The same goes for Estonia and Lithuania — many Belarussians work here also. If they choose to settle here and take up citizenship, they will not lose their links with Russia. They will take an interest in our policies towards Russia and could be tapped as a source in forming such policies. The migration and social change this entails creates problems for us but may also offer opportunities as we frame policy in the next ten years.

I thank Professor Hill for elaborating on these issues and I will continue from where Senator Quinn left off. In Western Europe it is perceived that the United States and the United Kingdom won the Cold War. Since that time the Soviet Union has been disintegrating. It was a great empire up to two decades ago and could be compared to the British empire, which has been declining for the past 100 years. Given how close Russia was to being a powerful empire, it is easy to understand how it must be smarting from its rapid disintegration in many areas recently. With the accession of the new states — Latvia, Estonia, Lithuania, Poland, the Czech Republic and so on — which are largely in the territory of the former Soviet Union and the two new states seeking accession, Romania and Bulgaria, as well as the reference to Turkey, is it possible we are chipping away further at what was once the great empire of the Soviet Union and that the European Union could be seen almost as an instrument of the United States? Many member states of the European Union are members of NATO. The EU is moving inexorably in an eastward direction rather than across the Mediterranean. From that point of view, is there a suspicion that the Cold War continues and that Europe is effectively the Trojan horse being used to diminish the strength of Russia? We are sort of bogeymen in that respect.

That 60% of the European Union's oil and gas comes from Russia makes such resources a potentially devastating weapon in the hands of the Soviet Union if it chooses to use them. We saw recently what happened with Ukraine when it began to operate in a semi-independent fashion. Europe appears to be in the grip of the Soviet Union if it wishes to turn off the taps. We have no choice but to co-operate and enter partnership arrangements with the European Union but this leaves the Union in an incredibly dangerous position in terms of energy resources.

What is the status of Ireland's relationship with Russia? We all remember when the previous President of Russia did not manage to come down the steps of the aeroplane when it landed at Shannon to meet the then Taoiseach and the current President has not visited us either. I understand the only visit to Russia by the Taoiseach was when he attended the World War II commemorations. It is a tenuous relationship and Ireland is doing very little trading with Russia. It appears to be almost the forgotten man of Europe and there is no direct impetus or enthusiasm from any of the European Union member states to have a proactive relationship on an individual basis with Russia. Is the likelihood that, as a result of that type of stand-offish attitude, Russia will head east and strengthen its relationships there rather than with the west, which is somewhat suspicious of it?

Professor Hill

I thank Deputy Costello for those points. A great deal of the euphoria that prevailed 12 years ago has evaporated. The Deputy was right in pointing out that some of the old traditional suspicions on both sides have re-emerged. The expansion of NATO rather than the expansion of European Union is perceived to be much more threatening. NATO is still seen as being aimed at Russia. The Warsaw Treaty Organisation no longer exists and Russia does not have an equivalent organisation. It still has ancient missiles pointing in our direction and it has many other mechanisms with which it could threaten us, the energy issue being one. The west is very much aware of this. Western Europe has been always much more trusting of Russia than the United States.

A great deal of western press commentary on the power Russia has over energy resources, especially oil and gas, comes from the kind of thinking that emerges from Washington. In many ways it was the United States that moved back on its position. It is still suspicious of Russian intentions. As I said in my presentation, Russia is still not an open, liberal democracy. Winston Churchill famously described the former Soviet Union as "a riddle wrapped in a mystery inside an enigma". There are lots of areas where relations between Russia and Europe and Russia and the outside world are a little unclear. The word "inscrutable" is used about Asians but, traditionally, Russia was a society that was cut off from western Europe for historical reasons.

It is true that, potentially, the energy weapon could be used and it certainly has been used among Russia's former allies, namely, Ukraine, Moldova and elsewhere, to try to bring them to heel. The pricing of energy resources has been used to support Lukashenko's regime in Belarus, although it has been announced it too will have to pay world prices from the start of next year. One solution to the energy issue — although I suppose there are several — is not to rely entirely on Russia. We are building a terminal for importing liquified gas from elsewhere. We are part of the European Economic Area with Norway, which is a big supplier of oil, the Netherlands has its own gas and we hope to find more. The availability of energy resources will become tight for the world. Therefore, we must try to copperfasten relations, through negotiations and confidence-building measures, to ensure Russia recognises our interests. We had such a statement from President Putin, although one of his spokesmen a few weeks ago pooh-poohed the idea that western Europe should be concerned about this. It is a complex issue which will not go away. My sense is that we should engage with Russia on as many levels as possible to ensure co-operation is the natural phenomenon. On the other hand, a point America has made is that it is the state in Russia that owns the resources. Therefore the resources can be more easily used for political reasons than if they were privately owned. When Gazprom was largely owned by the former Prime Minister, there was an issue in that regard.

As to Ireland's role in building relations with Russia, we entered that role late, as it was only in 1974 we opened the first embassy in Moscow, following Garret FitzGerald's foreign ministerial visit to Moscow and Georgia a few years prior to that. Our trade with Russia has never been particularly high. Even prior to that time we imported gas, chemicals and engineering products from Russia and we exported medical equipment, which we still do, computers and other products. We will never figure particularly high on the list of countries trading with Russia, which limits the opportunities we have to build relations with it. Aer Rianta was one of the first semi-State bodies to play quite a significant role in developing Irish trade relations with Russia. I understand that St. Patrick's Day parades still take place in Moscow, and I even saw one in Minsk. Considering Ireland had no relations with Russia except on a very individual basis until the 1970s, there is quite a remarkable Irish presence in Russia and not only in Moscow. My sense is that Ireland's enormous success since joining the European Union, in punching above its weight diplomatically and in many other ways, is appreciated in Russia. There are certain initiatives small countries may be able to take which large ones cannot. A number of years ago a former Russian ambassador here suggested there were certain areas where collaboration might be effective. We have certainly been used by the smaller nations, which are now partners, as an effective means rather than by Bonn or Berlin, London or Paris.

Certain things can be done through and by smaller countries even in collaboration with a great power. We have certain experiences but I can never think of them when I need to. We have always had a favourable image in Russia and the former Soviet Union, partly because of success in starting the break-up the British Empire, neutrality and our role in the United Nations. This still carries a great deal of kudos around the world, including in Russia. I do not have a direct answer but I believe engagement is good.

I welcome Professor Hill. As a professor of political science, I would be interested to hear his views on whether politics really is a science. At times, we do not know what we are doing and it is very confusing.

A bit like economists.

Yes. We do not know if it is a science or an art.

The professor described Russia as not a liberal democracy and perhaps an illiberal democracy. I hope I am not putting words in his mouth but it seems to have changed significantly since the Yeltsin period. I have a cousin who is a priest in southern Russia and I wish to ask about the treatment of religions. His experience is that there has been a very significant crackdown on the freedom of religions to practise, develop new parishes and open churches. Perhaps the professor will comment on the ownership issue.

Professor Hill mentioned Zhirinovsky. I thought he had disappeared but he is obviously still a significant individual in Russian politics.

Is the Deputy's cousin a priest in a particular order?

No, he is a parish priest.

The case of Khodorkovsky, a businessman who is in jail and who seems to have been singled out because he spoke out against President Putin, is very much a headline one. I do not know a lot about Russia and I admit I come to this topic a little cold but I know Amnesty International will not take up his case. Has the European Union any interest in it? Is there any way in which pressure can be put on the Russians?

We seem to be walking on eggshells as far as the Russians are concerned and are afraid to offend them. By so doing, we offend the simple principle by which the European Union has always stood. We are damned if we do and damned if we do not. It is a very unfortunate case. It is one law for Khodorkovsky and a different one for Abramovich and the other oligarchs who have benefited from the largesse of the regime.

I heard recently that Turkey had opened the gas pipeline. President Putin said it was not such a big deal and that Europe should not hang its hopes on it. That development in the southern Caucasus into Greece and Italy seems to have affected the way the Russians are thinking. I would like to hear Professor Hill's views on that.

Many Irish people would have concerns about the adoption arrangements between Ireland and Russia. It is probably not the professor's area but he might have some insight into the Russian Government's and people's attitude to adoption arrangements with Ireland.

Professor Hill

When the Soviet Union existed, everybody was deemed to know everything possible about it and one pontificated about everything. However, I will try to answer the Deputy's questions. On the religion issue, there is no doubt that in the past ten years or so, the Russian Orthodox Church has revived quite significantly and is opening new churches. Many people who were communists had themselves and their children baptised. There has been a reversion to the notion, which was current before the revolution, that if one was a real Russian, one was a baptised member of the Russian Orthodox Church. When President Putin visited New York, he went to a Russian Orthodox church in Manhattan. Mikhail Gorbachev said he had been baptised and I believe Stalin was also baptised. Stalin began his life as a seminarian in the Georgian Orthodox Church. In the Soviet period, religion was not quite banned but it was made very difficult to practise.

Part of the reassertion of a Russian identity to replace Soviet identity is to allow the Russian Orthodox Church specifically to develop. A law on religion, which was introduced five or six years ago, gives privileges to the Russian Orthodox Church but not to other churches. I think they are suspicious of the Roman Catholic Church because it is an international organisation and people look outside Russia to the Pope in Rome for spiritual guidance, so that is an issue. Even an organisation such as the Salvation Army was banned in Russia because it is an army and has generals.

The Russians are not interested in understanding these western organisations which went in and proselytised. If one is not a member of the Russian Orthodox Church in Russia and one is religious, the position is not particularly happy at present. I am not sure I would use the word "persecution", as I have not spoken to religious people in Russia for quite some time but it is certainly not a particularly comfortable experience.

In some of the countries which were part of the former Soviet Union, the Russian authorities, at least operating through the patriarch in Moscow, have tried to continue the assertion of the Russian Orthodox authority over the orthodox in those countries. There have been splits in the orthodox church in certain countries, for example, in Moldova. Whether the church in Moldova is a Moldovan Orthodox Church or subordinate to the Romanian Orthodox Church or the Russian Orthodox Church is still a matter of contention. The Deputy is right that religion is a contentious issue for those who are not Russian Orthodox believers. This has come to be seen as part of Russian-ness, as it was before the revolution.

The case of Khodorkovsky, alongside the case of Chechnya, has been rightly held up by the West. In the case of Khodorkovsky, it is possible that a sledgehammer was used to crack a nut but there are certain issues about how these people acquired their wealth. Abramovich is fine because he has supported President Putin. There is a politicisation of this issue and the Deputy is quite right in that regard. Khodorkovsky was apparently talking of running for the presidency. He had given money to a political party, Yabloko, and its candidate for the last presidential election, Yavlinsky. When he started to use his fabulous billions to influence politics in Russia, it was deemed unacceptable behaviour.

There is a traditional notion that division, washing one's dirty linen in public and showing opposition are not appropriate. There is a suspicion of western liberal democracy. Censorship was part of Russian thinking for a long time. For several years in the early 1990s, there was a totally free press and people thought standards of public behaviour and the press went down. As far as the Russian authorities are concerned, it is a tax issue for Khodorkovsky. However, one could tack that on anybody. That is the traditional way in which politicians under suspicion of wrongdoing in the United States, including vice-presidents — for example, Spiro T. Agnew — claim tax offences and get off relatively lightly. That may be the issue as far as Amnesty is concerned. Mr. Khodorkovsky was not jailed for political matters but in respect of tax offences. External agencies have difficulty dealing with that issue.

Is the Professor saying that the Kremlin targeted him politically?

Professor Hill

To judge from what I read, he used his money to support political parties against President Putin. Apparently, he made clear his aspirations to run for the presidency.

Does Professor Hill believe that is why he was subjected to these rigours?

Professor Hill

That is what it boils down to, yes.

When oil and gas reserves were discovered in Kazakhstan and elsewhere in central Asia, there were serious debates in the West regarding how to avoid having a pipeline through Russian territory because the country through which a pipeline runs can control it. As it turned out, the West's pipeline goes through Turkey to the Caspian Sea. One of the West's strategies is to make sure that it is not totally dependent on Russia.

Some of these countries are still within Russia's sphere of influence, so it is not possible to say how independent will be the pipeline. Many complex issues arise in this area. I am not a specialist on energy but it is something we need to monitor and about which we must negotiate. Given that western firms are building the pipelines, we have some influence over the long-term distribution of the energy. I do not have an answer to the Deputy's question because I do not follow these developments very closely.

I am not an expert on adoption. Children have been adopted from various parts of the former Soviet Union and parliamentary groups have travelled over to see how they have done here. Some came from Kazakhstan a few years ago. Russia would be unwilling to deplete its population further because it has declined by millions in the past ten years, partly due to emigration and as a result of the fact that ten or 20 years ago people did not have babies. Life expectancy has declined in the past 40 years to 58 for men and in the 60s for women, and infant mortality has started to increase. Childhood illnesses such as diphtheria have returned.

Several factors have contributed to Russia's demographic catastrophe. That may be why the authorities want to keep children there. They may also have a sense that if foreigners adopt children there, it undermines Russian national pride. I am not sure what the policy is but it is not as open as it was ten years ago.

The Russians put forward the idea that there was an Islamic attempt to establish a caliphate from the Caspian Sea to the Mediterranean. What are the implications in that regard? Surely Russia cannot be expected to release its grip on Chechnya and other countries that formed part of the Soviet Union. Can it afford to let them become more democratic?

Professor Hill

Russia is suspicious of Islam, partly for religious reasons relating to the Russian Orthodox Church. For political reasons, Islam was allowed to flourish in certain parts of Soviet Central Asia but one consequence of that was a population explosion. The westernisation, and the reduction in birthrate that might have accompanied it, did not happen, which greatly alarmed Russians. They felt that they were creating wealth that was being creamed off for the Uzbeks, the Kazaks, the Tajiks, and other neighbours. That part of the world fears the Islamic crescent following the 1979 revolution in Iran.

The Russians are conscious that there are millions of Muslims on their southern border. They fought a war in Afghanistan partly on that issue. This is a factor that unites Russia with the West. The Russians are aware that this part of the world is a major source of terrorism and drugs, which come from Afghanistan through former Soviet Central Asia and Moscow to western Europe. There are many other issues on which we have every reason to collaborate and the Russians are closer than us to those problems.

Russia regards Chechnya as part of the Russian Federation. It is not an independent country, although, having been conquered in the early 19th century, it wants independence. The people have always rejected their incorporation into Russia. Stalin deported them to Central Asia in 1940-1 but they were subsequently allowed to return. Their territory has been changed several times, from Chechnya to Chechnya-Ingushetia.

The ethnic groups and their cultural traditions in the North Caucasus make it one of the most complex areas in the world. The people in the mountain villages and valleys of south Chechnya have had little connection for generations. The Russians thought they were bringing in civilisation but that was rejected. The difficulty is that these people do not want to be part of the Russian Federation and, as they have demonstrated, they are determined to be violent in the pursuit of their goals. While they have not been prompted from outside, they have been influenced by what is happening outside.

Muslim identity is strong and Islamic extremists, identifying an opportunity there, have moved in. The ringleaders of the independence movement in Chechnya have sought outside support. In the Soviet era, many Chechens were part of the system. The speaker of the final Soviet Parliament was from Chechnya.

Ordinary Russians are suspicious of people from that part of the world, including the Chechens, the Ingush and the peoples of Dagestan, which comprise approximately 40 different communities. They come to Moscow to trade but Russian people call them "black people" because they have dark skin and are not trusted. There have been several violent incidents such as the blowing up of apartment blocks in Moscow, the theatre siege a few years ago and, more recently, the Beslan siege. Some of those people are quite ruthless. There is an argument that Russia's response to them has been quite out of proportion.

The name of the capital, Grozny, derives from the word to threaten and is the same word used for Ivan the Terrible, or Ivan the Dread. In photographs, the city now looks like a battlefield. RTE showed a documentary last year that was filmed secretly inside Grozny, which is in a terrible state. Most of the Russians have left. From one perspective, the situation looks like an attempt to destroy the will of the Chechen people. I would not use the word genocide, but some people might see it in that light.

The Chechen representatives we see in exile look and are sophisticated. They benefited from the Soviet education system and acquired notions of identity, statehood, nationhood, etc. as a result. However, as far as Russia is concerned, these notions are seen as a further breaking down of the Russian empire, which is something it fears. This happens apart from its concern about the pipelines across Chechen territory.

There are many reasons that the Russians will not let go of Chechnya. The question is who will blink first and will the Chechens come to terms with the fact that they will always be part of Russia. Whether the extreme nationalists who are prepared to use extreme measures will eventually succumb or be destroyed, I do not know. I am not sure what pressure we can use to help resolve the situation. Russian regards it as an internal affair and I do not know what we can do about it.

What is the situation in states adjoining Chechnya, for example, Uzbekistan, Tajikistan and Kazakhstan?

Professor Hill

In most cases, they have reverted to Islamic authoritarianism, including dictatorship and highly authoritarian rule. One exception is Kyrgyzstan, which still has a substantial Russian minority. It is a small, mountainous, landlocked country that had what we might term a democratic revolution 18 months or so ago. Some of these countries have treaties and military arrangements with Moscow. Others, for example, Tajikistan, have had western bases for attacking Iraq and Afghanistan.

These countries are going their own way and finding friends wherever possible. Russia is doing the same. It will take a number of years for the collapse of the Soviet Union and what we can do about it to be played out. The Commonwealth of Independent States, CIS, which nominally replaced the union, has been a failure. It operates on certain levels but it has not replaced the Soviet Union in any sense. All the expectations of 1991 have effectively gone. When the Ukrainian Foreign Minister was here two or three months ago, he said that Ukraine co-operates within the CIS but is not a member of it. This says something about the second largest country of that commonwealth after Russia.

The CIS works on a bilateral basis and provides trade and various other facilities. Essentially, countries have gone their own way and no longer necessarily have an orientation towards Moscow. The countries of central Asia can look to their Islamic neighbours, such as Iran, for leadership if they want. That is precisely what has been happening.

I join in the welcome to Professor Hill. Our briefing note gives a general economic overview of the changes that have taken place in the Russian economy. I presume that the statistics are monitored. The number of mobile phones in Russia in 2000 was 1.4 million and this grew to 125 million by the year 2005. Advertising revenues over the same period went from $760 million to $3.98 billion. Bank debt was $5 million in 2000 and this grew to $32 million by 2005. Cinema ticket sales were at $10 million in 2000 and grew to $266 million by 2005. These figures reflect the significant change in the Russian economy.

Energy exports are important to the Russian economy. Will Professor Hill outline the current position in respect of the nuclear industry? With regard to the conventional political party system as we understand it, does the professor believe that Russia's development has suffered politically and economically because it does not have the type of system to which we are accustomed? The heavy hand of the state is a factor in the situation. The state is very much involved in day-to-day decisions and has considerable power over economic development. Does the professor see that changing or is there a need to change? Do the Russian people wish to see that change?

Is Russia moving in the direction of the evolution of a new type of economic model? Will it be different to the model to which we in Europe have become accustomed? Do Russians accept communism has failed as a political system and have they turned their faces against it forever? Is there any residual hankering to return to the good old days when communism was part and parcel of daily life in Russia?

Professor Hill

Those are very interesting questions. I was interested in the particular statistics the Deputy quoted, which I had not seen before. They reflect a certain development in the Russian economy, namely, that many younger people in particular have suddenly acquired wealth. There is no doubt about that. In the cities of European Russia, the economy has been booming. It collapsed in 1998 when the value of the currency fell. This had a catastrophic effect and caused Russia to default on its international obligations. Since then, the economy has been doing quite well, partly because of the introduction of more control over what those who acquired wealth could do with it.

During the 1990s, the West was shovelling money into Russia and people there were shovelling it out and putting it into banks and hotels in Cyprus and elsewhere. That activity has ceased. In one sense, there has been stability in the economy and Russians now see some point in investing in Russia. That was not the case in the mid-1990s, which was one of the features that led to the collapse of 1998. Another reason was that heavy industry — the dirty industry that was the mainstay of Soviet industrial development — was using 19th century steel-making techniques right up until the 1980s. Once it became possible for firms to go bankrupt, they did so. They are being replaced, often with western investment, through joint ventures or direct investment. Russian entrepreneurs are also involved.

There was, in a sense, a spirit of entrepreneurship waiting to get out, particularly among younger people. When the opportunity arose, even former members of the Komsomol, the young communist organisation, became successful businessmen and some are now billionaires.

On whether Russia is moving towards a new economic model, I do not know how many economic models are in existence. In Europe, we lived with a mixed economy for decades after the Second World War. That is what Russia has now. Whether it still believes, as Lenin did, that the state must hold the commanding heights of the economy — the bags, as he called them — these are now independent in Russia. However, the steel industry and other heavy industries still stick to that model. It may well be, as I indicated earlier, that this gives them political power.

One of the issues the West raises is that the title to property in Russia is not yet certain for foreigners. Shell, BP, Amoco and the other big explorers and exploiters of energy are reluctant to commit themselves for the long term. They must do so, however, because the investments are colossal.

There has been a great deal of privatisation. In the early years, the privatisation was disastrous from the point of view of ordinary Russian citizens. To return to the Deputy's final question, they accept that the communist system could not deliver what they wanted. I will return to some of his other points in a moment. There was an acceptance that the economy had failed when, in 1989, miners in the Donbass region could not get soap because it was not available. That was a sheer sign that the system could not deliver what it should have been delivering. There was certainly a recognition of that. On the other hand, as our friends and colleagues in Hungary demonstrated two or three weeks ago, the values of the supportive state — the welfare state — continue to be missed. In many countries, a swing towards a liberal, western-type approach has been followed by a return to the security of the welfare state.

While the welfare state in Russia may have been of a fairly low standard, it was better for the people at the bottom. It is shocking to go to Russia now and see pensioners and people without limbs, who were probably injured in Afghanistan, being obliged to beg on the streets. That is something one would not have seen previously. There were beggars, but not on the scale that is now evident. There is a recognition that everything now costs very much. The arts were heavily subsidised and ordinary people could afford certain things. While the standard of living was low by western standards, people did not feel they were in penury. There is no doubt that many millions of Russians have lost out. There is some nostalgia for some aspects of the past, although not for the communist bureaucratic system. Many Russians are seeking a strong leader. That is part of Russian thinking. I am not sure that ordinary Russians understand the significance of a democracy, as we understand it.

If I were a political leader in an authoritarian country and I considered matters such as the one-day strikes in France every few weeks and the demonstrations in this country in the late 1970s and early 1980s, I would not see democracy as a particularly comfortable political process. People who are used to order imposed from above expect the Government to resolve their problems for them. There is still a great deal of thinking of that nature in Russia. The heavy-handedness of the state is another issue. The state allows people to do far more than once was the case. There is far more freedom in Russia than there was in the Soviet period.

A point needs to be made about one aspect of the West's criticism of Russia and other counties. The term "civil society" has become currency in these newly democratised countries in the past seven or eight years. To us, civil society means that the State keeps out of certain things. The medical and legal professions and the GAA, for example, regulate themselves without the State setting the rules. When the West, especially the United States, allocates money in the countries to which I refer in support of civil society, it gives money to organisations that are deemed to be against the Government. I noticed this in Belarus, in particular, which I have studied and visited in recent years. The money given to the local and private press during the presidential elections there was seen as tainted. Non-governmental organisations that are given money by the West are tainted, by definition, because the money is given to them to challenge the Government. This is something the West does not necessarily understand clearly. When we give money to countries to develop civil society, it is seen as a threat by those whose roles might be displaced by the organs of civil society. If a country has a bureaucratic tradition whereby one's position depends on one's ability to make the rules, as was the case with the communist bureaucracy in the Soviet Union, one will be made redundant if one allows private political parties and organisations which are challenging the Government and the official organs of the state to get involved. One will, therefore, resist such involvement. We need to reconsider how we assist Russia and other former communist countries.

I also referred to the nuclear industry.

Professor Hill

The European Union understands that it has expertise that can help Russia to decommission its nuclear industry's first generation generators, which, as we saw in the case of Chernobyl, are not very safe. We can help Russia to develop and control more modern forms of nuclear power generation. Russia's nuclear weapons are, almost by definition, subject to international treaties. The United States will play a rather bigger role than the EU in that regard. I understand, from what I have read, that EU committees are working with Russia on this issue. The question of Iran surfaced in the last few months when Russia offered to reprocess on behalf of Iran. We have a direct interest in helping Russia to introduce a regime of control in respect of nuclear power generation and nuclear materials. We all recognise that terrorism and various other things are potential threats to everyone. It seems, from what I have read, that there is some potential for close collaboration with Russia in that regard.

Does Russia participate in the activities of the International Atomic Energy Agency?

Professor Hill

I cannot provide a definite answer. However, I believe the answer is yes.

Deputies Costello and Kirk touched on an issue that I would like to raise now that the relevant statistics are available to Professor Hill. In 2005, Russia was Ireland's 41st largest trading partner. Our bilateral trade with Russia was worth approximately €313 million, which represented an increase of in the region of 13%. I would like to mention a specific issue that bears out what Professor Hill said about the goodwill and positive attitude of the Russian people to Ireland. It has been highlighted to me that Irish businesses are having a particular difficulty in their dealings in Russia. Like other foreign operations, Irish companies are finding it difficult to receive and make payments, operate bank accounts and complete foreign exchange transactions in Russia. I do not expect Professor Hill to have all the details relating to this problem, but is he aware of it? Is it something that often arises?

Professor Hill

I am not specifically aware of the difficulty. It seems that everyday exchanges between companies and individuals continue to be problematic. The Soviet banking system was totally state-controlled. The state had a monopoly on foreign trade until the collapse of the Soviet Union. The banking system has been volatile and not particularly stable. There have been problems with the mechanisms for the exchange of money, apart from in cases of small dealings such as Western Union transfers. The visa regime for ordinary citizens who travel back and forth to Russia has been tightened up over the last ten years. One cannot simply decide that one wants to go to Russia, although I understand an agreement was reached in Sochi last week to facilitate that over the next few years. Many petty obstacles of that nature stand in the way of Russia's development of relations with the West. Anyone who wanted to enter the Russian empire two or three centuries ago was obliged to wait at the border while someone went on horseback to St. Petersburg to get the letters patent from the tsar to allow him or her to enter. Thankfully, we have come a long way from such requirements. However, much can be negotiated in this respect.

I will briefly mention the agreement made at the EU-Russia summit on 31 May 2003 to reinforce bilateral co-operation by creating four common spaces between Russia and the European Union. It was decided to create a common economic space, a common space of freedom, security and justice, a space of co-operation in the field of external security, as well as a space of research and education, including cultural aspects.

While these spaces cover many matters, fairly rapid progress has been made in respect of visa and re-entry regimes. Undoubtedly, things are opening up and we must simply keep plugging away. When things stand in the way, I have a tendency not to bother with them. However, we should engage with Russia.

On behalf of the joint committee, I again thank Professor Hill for his interesting and informative presentation. It was a good start for the joint committee in this regard. Senator Quinn is correct to suggest that the committee should probably have considered this topic previously.

Sitting suspended at 3.31 p.m., resumed in private session at 3.32 p.m. and adjourned at 3.45 p.m. until 2.15 p.m on Wednesday, 14 June 2006.
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