By Eric Vandenbroeck and co-workers

In fact already early on this year we mentioned the energy situation the Ukraine tends to be presured by. Now that the Orange Coalition clearly is back in government control, Russia has already pulled out its first card against the pro-Western government and is threatening to cut natural gas supplies.

In a move he says is aimed at uniting national interests and creating stability, Ukrainian President Viktor Yushchenko said Oct. 4 that he wants all three of Ukraine's largest factions to be involved in the government. This would not be the first time the Orange Coalition camp has worked with the pro-Russian opposition, but this time Yushchenko is attempting to undercut the other two's power -- and hold onto any control he still has. Given that the popularity of Yushchenko and his party has been in a steep decline for the past year, Yushchenko knows that his coalition partner, Timoshenko, is holding all the cards within their alliance. But he also knows she is a powder keg that could blow apart the negotiations with the Russians. Meanwhile, given that opposition leader Viktor Yanukovich and his pro-Russian Party of Regions are out of the line of fire, they are in a perfect position to watch Timoshenko ruin the negotiations -- and her coalition's position in the government.

The best way for Yushchenko to undercut the two more powerful faction leaders is to get them in an alliance. This would balance Timoshenko's power within the government and also prevent Yanukovich from building a more powerful opposition. Yushchenko knows that any alliance between the self-serving Timoshenko and the equally self-serving Yanukovich would end in failure -- as their alliances always do. But he also knows that forcing them together would undercut their individual power and possibly prevent a collapse of the negotiations with Russia in the short term. It is a crafty plan by Yushchenko to keep himself and his party from becoming entirely obsolete in the power struggle between Timoshenko and Yanukovich.

Of course, the real job is actually getting the two to sign onto his plan. Timoshenko's party representatives already have said they will not negotiate with the Party of Regions, but Timoshenko has made similar declarations in the past and then flip-flopped when push came to shove. Pulling the pro-Russian Regions into an alliance when Russia has laid threats at Kiev's door could be one of those times. Getting Yanukovich to sign on could be equally as tricky, though he might go for it if his people are offered key positions in the new government. It is an intricate and fragile plan by Yushchenko, but he has few options left if he is to remain a player in the game.

Thus as soon as it was clear that the pro-Russian government was not going to stay in control of the Ukrainian government, Russia's natural gas behemoth, Gazprom, demanded that Ukraine pay its $1.3 billion natural gas debt. The sum is more than Ukraine can technically handle - and Russia knows it. Ukrainian natural gas middleman RosUkrEnergo - which is partially owned by Gazprom - accrued the debt under the last government, led by the pro-Russian Viktor Yanukovich. However, these details do not matter because Gazprom has the legal right to turn off Ukraine's natural gas until the debt is paid.

As soon as Gazprom called in the debt, Timoshenko - soon to be named prime minister - announced that she personally will handle the negotiations with Russia. Timoshenko has a long and very volatile history of natural gas negotiations with Russia and has never really been successful in reaching deals with Moscow. In 2005, Timoshenko's failure to negotiate with Russia led to a split with her partner in the Orange Coalition, President Viktor Yushchenko, forcing her from her office as prime minister. Of course, Yushchenko's attempts at negotiations led to a natural gas shut-off during the height of winter not only to Ukraine, but also to the dozens of European countries to which Ukraine transits Russian natural gas.

After Yanukovich took over as prime minister, Ukraine could finally negotiate productively with Russia. Yanukovich has already said he will beat Timoshenko to Moscow for negotiations; he is planning a trip within the next week and sent Energy Minister Yuri Boyko to Moscow on Oct. 3 to start the talks. Yanukovich is using this time to show that he is the only politician who can guarantee Ukrainian energy security, even though he and Boyko lack legal authority since the election removed them from power. This will show who actually holds the power in Ukraine: the incoming Timoshenko or the outgoing Yanukovich.

Gazprom's move is already creating international pressure for Ukraine's new government, with the European Commission calling for a "speedy settlement." Europe does not have much leverage to force Ukraine and Russia to negotiate, but it has a contingency plan for another natural gas cutoff. European natural gas storage facilities are at their maximum, which will ease the pressure if Gazprom goes through with the cut, but those supplies will not last long and Europe will continue to push Ukraine to negotiate -- especially before winter sets in.

Thus although at first not very evident, Georgia and Ukraine appear to be slipping back towards Russian control. In Georgia, the Secretary-General of NATO, Jaap de Hoop Scheffer himself, visited on Thursday, and, while warning unnamed countries not to interfere in NATO's expansion efforts, flatly stated that Georgia was not going to be on the alliance's candidate list any time soon. De Hoop Scheffer went on to indirectly criticize some of Saakashvili's policies, implying that not only were they slowing Georgia's accession efforts, but also unnecessarily souring relations with Russia.Back in Ukraine, Yushchenko landed his own surprise by opining that once he and Timoshenko hammer out a coalition deal, several key posts should be reserved for his pro-Russian archrival, Party of Regions' Viktor Yanukovich. The (unspoken) logic was that Timoshenko is an overbearing, vindictive harpy who uses government office to enrich her allies and punish her enemies, and Yushchenko would rather have his enemies right where he can see them.

This came shortly after Georgian President Mikhail Saakashvili returned home Oct. 2 to a country in political disarray. Saakashvili was in New York for the past week at the U.N. General Assembly, where he lambasted Russia for meddling in Abkhazia and South Ossetia, Georgia's two secessionist regions. However, in Saakashvili's absence, the president's former ally and defense minister Irakli Okruashvili - now an opposition leader - was arrested on corruption charges, a development that sparked one of the most serious political crises inside Georgia since the 2003 Rose Revolution. Okruashvili's arrest came the day after Saakashvili's speech at the United Nations. Saakashvili has personal reasons to want to arrest Okruashvili: he did accuse the president of corruption and of plotting murder. But the timing of the arrest raises the question of whether Saakashvili finally decided to move against his only real rival in order to signal to Moscow that he is willing to squash the active anti-Russian movement and prove that he is still in charge in Tbilisi.

However, the move has sparked a domestic crisis that now threatens Saakashvili's hold on power. Okruashvili's arrest led 15,000 opposition supporters to rally in Tbilisi on Sept. 28 in the largest demonstration since the 2003 Rose Revolution, which involved 30,000 protesters and overturned the government.
The Georgian people have been gripped by the latest political turn of events, with millions said to have tuned in to watch the Okruashvili drama unfold. Furthermore, Saakashvili's approval rating has plummeted, from 86 percent when he entered office to 16 percent.

It is yet to be seen whether the opposition can unite long enough to become a force like that seen in 2003. However, Saakashvili is already doing a balancing act with Tbilisi's relations with the West and Russia; now he must also handle his own people.

Russia will also have a tough choice ahead, as Georgia appears to be heading toward chaos once again. Though Russia does not like Saakashvili in power, Moscow can manage him; it could not manage chaos or an opposition leader bent on further actions to halt Russian interference. Russia will have to decide whether now is the time to thrust Georgia into a turf war, or whether that fight should wait until Russia is certain it can move effectively against its small neighbor.

So NATO is giving Georgia the cold shoulder even as Yushchenko - albeit for his own reasons - is offering the Russians a say in how the Ukrainian government is run. Added together, two of the most critical states to the Russian effort to reassert its influence seem to be shifting to a more neutral stance, despite public developments to the contrary. Russia now has an interesting decision to make. Both states are ameliorating the pain they have regularly caused the Kremlin in the past four years, and Moscow could well sit on its laurels. But the Russians have more fish to fry. With the United States military obsessed with Iraq, Moscow will never have a better opportunity to retake influence in its near abroad, so quiet realignments may not quite be enough for opportunity-rich Russia. The Kremlin may well insist on more public capitulations.

Finally today (Oct. 5) then, presidents of the self-declared republics of Abkhazia and South Ossetia, separatist enclaves in the former Soviet republic of Georgia, are meeting in Moscow with Russian officials. The two enclaves regularly consult and cooperate on defense matters, but the real strategic decisions are made in the Kremlin. Both enclaves' de facto independence is largely dependent upon Moscow's largess. Late September and early October have witnessed a substantial increase in military tensions between Georgia and its separatist enclaves, mirroring and contributing to rising tensions between Tbilisi and Moscow. The two enclaves have long been key Russian assets, and now as Russia attempts to re-establish its influence in the Caucasus, the only question is how to implement specific strategies to undermine Georgia. So Sergei Bagapsh of Abkhazia and Eduard Kokoity of South Ossetia have come to Moscow to receive their marching orders.

 

 

For updates click hompage here