Institute of Modern Russia

The Ukrainian government’s decision to suspend the process of negotiating an association agreement with the European Union was a shock both in Ukraine and in the EU. While Russia President Vladimir Putin announced that Ukraine had been blackmailed by the EU, others were less sympathetic to Ukraine’s government. One of the leaders of the Ukrainian opposition, Arseniy Yatsenyuk, called the decision “illegal and unconstitutional,” and called for the impeachment of Ukrainian President Viktor Yanukovych “for the high treason.” At the same time, Swedish Foreign Minister Carl Bildt declared that “the Ukrainian government unexpectedly caved to the Kremlin. It is clear that the policy of brutal pressure is working.”

Against this backdrop of criticism, Viktor Yanukovych has tried to downplay his decision. A lawmaker from the pro-presidential Party of Regions, Vladimir Oleinik, said that the government’s decision “does not mean a reversal in foreign policy and the country is not entering into the Customs Union.” Yanukovych had the courage to go to Vilnius to try to convince Brussels to begin trilateral talks with Russia. This idea was originally floated by Russia’s ambassador to the EU, Vladimir Chizhov, who, however, suggested that the EU and Russia negotiate without the participation of Ukraine. According to him, Ukraine could join the negotiations already being held in the Eurasian Union. This plan was offensive to Ukraine, though, as Moscow was depriving Ukraine of the right to act as an independent agent in the international arena. In rejecting European integration, Ukraine falls into even greater dependence on the Kremlin.

The responsibility for Ukraine’s refusal to sign the agreement in Vilnius lies on Vladimir Putin, who certainly put pressure on Kiev, and on Viktor Yanukovych, who was trying to negotiate the most favorable terms for both sides, but ended up with a threat of revolution. The harder Moscow pressed, the higher Yanukovych raised his terms in bargaining with the EU. At the same time, we must recognize that the threats the agreement posed to Russia were far from harmless. First of all, it would have meant a gas problem. The signing of the association agreement would mean Ukraine’s introduction to gas prepayment (for which Ukraine’s debt to Russia is about $10 billion), trade sanctions from Russia, higher gas prices for Ukrainian domestic consumers, and the ousting of Ukrainian manufacturers from the Russian market by higher quality European producers. It’s not hard to understand Yanukovych’s fear: in signing the agreement he would have to face the discontent of the business elite, social risks, and a huge hole in the budget, a hole that has grown thanks to the gas debts. It is important to mention that in accordance with the gas contracts signed in January 2009, Ukraine pays much more for gas than European consumers. The price is 510 euros per one thousand cubic meters, without the discount of 100 euros for the right to lease Russia’s Black Sea Fleet base. Getting rid of Ukraine’s current onerous gas contracts was Yanukovych’s main goal in his dealings with Russia.

Brussels and the Ukrainian opposition are operating under different logic. In filling the conditions of the agreement, Ukraine would indeed risk facing socio-economic difficulties. Yet this is the only way to reform the country—getting rid of inefficient industries, carrying out social reforms, improving the effectiveness of the government and the fight against corruption, and finally, reducing dependence on Russia. But Yanukovych knew that the path toward Europe would be at the cost of the government’s public image, which would corrode with the social losses the population would suffer as a result of the unpopular reforms. And Moscow “applied pressure,” promising Yanukovych enticements for rejecting the agreement, such as political support in the 2015 presidential elections. Parliamentary leader of the Fatherland Party Arsenyi Yatsenyuk said that Yanukovych “bargained” $20 billion from the Russian Federation, some of which is to be used for conducting the 2015 elections.

As a result, Yanukovych took the path of least resistance. He declined to release former Ukrainian Prime Minister Yulia Tymoshenko abroad and demanded a sum of 160 billion euros from the EU for carrying out the reforms that the association agreement would require of the country. Representative of Ukraine to the Eurasian Economic Commission Viktor Suslov said that “The EU has refused to hear a number of Ukraine’s allegations, made ​​at the highest level: about financial assistance, about the very high price of commitments for the transformation of technical standards and regulations—from $100 billion to $500 billion.” According to Ukrainian Deputy Prime Minister Yuri Boiko, the authorities hope to find a solution in which “the decline in industrial production and Ukraine’s relations with the CIS countries would be compensated for by the European market.” Only after that can Ukraine’s association agreement negotiations with the EU be extended.

Brussels, of course, refused to pay this amount, and found the trilateral format of the negotiations unhelpful. Yanukovych had simply “gone too far,” compelling Ukrainians to believe in a “European dream” only to slam the door to the EU in their faces (not everyone understand that an association agreement doesn’t mean EU membership). The responsibility for the deep public disappointment lies with Yanukovych, for apparently creating high expectations among the Ukrainian population.

The president of Ukraine was trying to avoid socio-political risks and maintain the status quo. Instead, he now faces the threat of a new revolution. Moscow, feeling no responsibility for what is happening, is using its propaganda machine to convince a poorly informed society that “pogroms” are occurring in Kiev. Central Russian TV channels show extremists battling authorities in Kiev, endangering national security. The Kremlin cannot afford to tell the truth: its fear of similar protests arising in Moscow is too strong. Many experts now speculate that the Kremlin will order the toughest sentence in the “Swamp case,” a trial in which dozens of people have been accused of arranging riots in Bolotnaya Square on May 6, 2012. The regime is afraid of clashes arising between the opposition and the police, so the decision has been made to “apply pressure” while the protests are still few in number.

Yet despite the fact that observers speak of the “Byelorussization” of Ukraine, Yanukovich’s prospects are far more limited than Putin’s. His regime is electorally less stable and more polycentric than Putin’s, and the Ukrainian opposition is very strong. To suppress protests means dramatically increasing the chances of a military overthrow of the government. Not that what’s currently unfolding in Ukraine could ever be called peaceful: Storm troopers, led by the nationalist activists of the “Freedom” party, seized several administrative buildings and were rebuffed by Ukrainian Special Forces. In the center of Kiev, the police mobilized units of the internal military forces. While such clashes have been localized in nature, the bloody events cannot be ignored. The EU, in turn, is considering imposing sanctions against those who took part in the dispersal of the opposition.

The stronger the street confrontations between Ukrainian authorities and the opposition grow, the farther from Europe the authorities are, and the closer to Europe the Ukrainian people are. But is Yanukovych getting closer to Russia? Will Moscow extend a helping hand? Unlikely. Vladimir Putin has said that there will be no revisions of the gas contracts. But Russia’s moral support during the revolution only worsens the plight of Yanukovych.

The stakes are high in Yanukovych’s close circles. Today, the most popular themes discussed by the ruling Party of Regions are treason and the search for the “fifth column.” “Yanukovych was framed—it’s obvious. It made no sense to disperse [the protest at] Maidan [Square] on Saturday night—it was already out of steam. Today or tomorrow the opposition would have announced its dissolution until spring. And now everything has changed. People have reason to go outside again, the opposition took the initiative,” said a Ukrainian political consultant working with the Party of Regions in an interview with a Kommersant journalist, though now he prefers not to advertise this fact. The pro-presidential legislators have begun to defect: Verkhovna Rada Members David Zhvania, Mykola Rudkovsky, Inna Theological, and her husband Vladimir Melnichenko have already declared their departure from the party. A lawmaker from the Party of the Regions, Viktor Bondar, predicted losing about twenty deputies from the faction because of the rally dispersal at Independence Square on November 30.

What is Yanukovych left with after abandoning European integration? With an empty treasury and gold reserves of $20 billion, with a million protestors in the capital alone, and with an arm-twisting Moscow. The president underestimated the expectations of the people, underestimated the strength of the “European dream” that captured the minds of Ukrainians. He tried to avoid a future political collapse, and got a collapse in the present instead. He counted on Russia’s help, but Russia is looking after its own interests. Yanukovych was the weakest link in the complex balance of geopolitical forces among Europe, the U.S., and Russia. In trying to calculate the potential gains and losses of an association agreement, he forgot to account for one thing: the national interest of the Ukrainian people. He was not just a victim of Putin’s manipulations; you cannot play the victim while taking gifts from a predator. Now he must decide how to deal with the resulting protests: turn into another dictator, or run away, leaving the opportunity to resolve the situation to others. Yanukovych still has a choice, but time is against him.