Wider Europe

Welcome to Wider Europe, RFE/RL's newsletter focusing on the key issues concerning the European Union, NATO, and other institutions and their relationships with the Western Balkans and Europe's Eastern neighborhoods.

I'm RFE/RL Europe Editor Rikard Jozwiak, and this week I'm drilling down on Brussels' proposal for another round of sanctions on Russia and looking at what's left of the Eastern Partnership.

Brief #1: Can The EU Agree On More Russia Sanctions?

What You Need To Know: The European Commission presented a new Russia sanctions package in mid-November -- the 12th since the full-scale invasion of Ukraine in February 2022. The hope in Brussels is that the 27 EU member states will sign off on the package by the end of the year, preferably ahead of or at the EU summit in Brussels on December 14-15.

At first sight, getting a green light looks possible, considering there is still time. There have already been a few rounds of discussions among high-level diplomats, and the sanctions package isn't perhaps the most controversial of proposals. It doesn't, for example, hit the Russian gas or nuclear sectors.

Yet, it took nearly seven weeks for the member states to agree on the 11th sanctions package back in the summer, and those measures were equally unambitious. The ongoing issue is that certain member states want to water down the proposals, claiming that the sanctions hurt their economies more than Russia's.

For example, Slovakia has asked to extend the exemption that it and other landlocked countries were given, meaning the country could continue importing Russian oil via pipeline until the end of 2025. Germany is also keen to get an exemption on the ban on Russian vehicles entering the bloc and the Czech Republic wants to be able to import Russian steel until 2028. All these measures were already agreed in previous sanctions packages -- and the exemptions that has been sought could very well be agreed again.

Deep Background: Exemptions aren't the biggest threat to the deal. Predictably it is Hungary, which has questioned the EU's sanctions regime on Russia from the very start. Diplomats I have spoken to on condition of anonymity because they are not authorized to speak on the record say they believe that Budapest will block the new deal in order to gain leverage on the European Commission releasing 13 billion euros ($14.2 billion) of EU funds so far held by Brussels over Hungary's backsliding on the rule of law.

In a recent letter, seen by RFE/RL, addressed to European Council President Charles Michel, Hungarian Prime Minister Viktor Orban asks for a "strategic discussion" on the EU's approach to Ukraine in a number of fields -- not only Russia sanctions but also financial aid to Kyiv and the country's potential EU accession. The letter notes that "the European Council is not in a position to make key decisions on the proposed security guarantees or additional financial support for Ukraine, endorse further strengthening of the sanctions regime or agree on the future of the enlargement process unless a consensus on our future strategy towards Ukraine is found."

Specifically on sanctions, the letter notes that "we must also have a clear view [of] what the European Union has actually done to mitigate the obvious adverse effects of the sanctions on individual member states." Everything is essentially coming to a head, ready for those last critical weeks before Christmas.

Drilling Down

• So, what is actually in the sanctions package? The top line is probably the proposed ban on Russian diamonds, something that many EU member states have pushed for. Belgium, however, with its diamond-trading hub of Antwerp had pushed back on this -- until now.
• If approved, the ban would apply to both Russian natural diamonds and diamond jewelry from January 1, 2024. Then, starting on March 1 and with the aim of being completed by September, there will be an indirect import ban of processed Russian diamonds, meaning stones that have been cut or polished in third countries. For this, the Group of Seven (G7) leading industrial nations will have to come up with a workable global traceability mechanism, something that Belgium has asked for in order for its sign-off on the diamond ban. There will also be an EU import ban on Russian copper, aluminum wire and foil, as well as Russian liquefied petroleum gas (LPG).
• The export ban has been further widened to include EU companies providing cryptocurrency wallets. The mostly digital applications, used to store cryptocurrency keys, can also be used for the design and manufacture of certain dual-use goods, which can have both a civilian and military purpose, such as lithium batteries and thermostats for drones.
• While not touching the actual price cap on Russian oil set late last year in conjunction with the G7 at $60 per barrel, the latest sanctions proposal introduces tougher financial reporting requirements that extra costs, such as for insurance and freight, must be declared, as regulators fear such extras are being inflated as a way of creating more revenue for Russia.
• And in order to try to thwart Russia's "shadow fleet" -- unlicensed vessels carrying and selling Russian oil above the price cap -- the European Commission will now ask member states to notify the competent authorities of any sale or export of tankers concluded since 2022. Both this measure and the one concerning more detailed financial reporting, however, could be watered down by EU maritime nations fearing too much red tape.
• Perhaps the most interesting part of this latest sanctions proposal -- and one that will almost certainly be softened -- is a requirement for the EU subsidiaries of Russian companies to transfer all their funds either back to Russia or to a third country. Firstly, it is not an outright ban, which is important to note; and secondly, there are exemptions to ensure critical energy supplies are not interrupted -- so, for example, the subsidiaries of Russian gas companies would likely be spared. But it could affect other EU subsidiaries, making it much harder for them to survive.
• As always in these packages, there are also 48 people and 73 entities that the bloc wants to slap visa bans and asset freezes on -- adding to a list that already consists of over 1,800 names in total. Included on the new one are several high-ranking Belarusian military officials; Rady Khabirov, the head of the Russian republic of Bashkortostan; Viktor Afzalov, the commander of the Russian Air Force; and Putin's cousin, Anna Tsivileva.
• Interestingly, there is also a proposal to keep dead people on the sanctions list. Normally, a deceased person is removed, but Brussels is hoping that an asset freeze can remain, as funds can still be generated to financially aid Russia's war in Ukraine. (For obvious reasons in such cases, there will be no more need for a visa ban.)

Brief #2: The Eastern Partnership Is Still Hobbling Along

What You Need To Know: Perhaps it was the zenith of the European Union's Eastern Partnership. It was the end of November 2013 in the Lithuanian capital, Vilnius, and EU leaders were gathering for a high-level summit together with their counterparts from the bloc's six eastern neighbors: Armenia, Azerbaijan, Belarus (represented by then-Foreign Minister Uladzimer Makei as authoritarian leader Alyaksandr Lukashenka was persona non grata), Georgia, Moldova, and Ukraine.

The latter trio was supposed to initial association agreements with the EU that would bring them closer to the bloc. The international press was out in force at the conference center, not for the Georgian or Moldovan leaders but to see whether Ukrainian President Viktor Yanukovych would sign the association agreement. There had been reports the evening before saying he wouldn't sign, which turned out to be exactly what happened.

Meanwhile, more and more protesters had gathered in Kyiv, angry that the Ukrainian government appeared to prefer closer ties with Moscow than the European Union. The next day, riot police dispersed the crowd, which reoccupied the square shortly afterward. The protest, later known as "Euromaidan," eventually forced Yanukovych to step down and flee to Russia.

Deep Background: Exactly a decade later, on November 28-29, I was back in the Lithuanian capital to participate in a seminar that dealt with the future of the Eastern Partnership. The key takeaway was that, in many ways, the Eastern Partnership had been a victim of its own success.

The partnership was created after a Polish-Swedish initiative in 2009 and had the goal of bringing the six former Soviet republics closer to the EU but not putting them on the same accession path as, say, Turkey or the countries of the Western Balkans. Wary of antagonizing Russia and the growing enlargement fatigue in the bloc, Brussels chose an easier, softer path -- the Eastern Partnership.

In the end, despite the initial intentions, half of the Eastern partners did follow that traditional route, in the sense of moving along an accession pathway. Following Russia's full-scale invasion of Ukraine in February 2022, Moldova and Ukraine became official EU candidate countries and, if EU member states agree in the coming weeks, will start EU accession negotiations next year. Georgia, one step behind the other two, is set to become an official candidate country by the end of 2023. Those three countries have all gone beyond what was promised by the Eastern Partnership.

Drilling Down

• The question then is whether the format has outlived its purpose. Officials from Ukraine, Moldova, and Georgia, all speaking on background, told me that they don't like to be grouped with the other three Eastern Partnership countries -- Armenia, Azerbaijan, and Belarus. While they are all publicly positive about the Eastern Partnership, the more advanced candidates can see less need for the initiative these days, because, to their minds, the only thing that unites them now is a Soviet past.
• Armenia, which is making moves away from Moscow but is not yet ready to apply for EU membership, might be the keenest of the six to keep the partnership going. Azerbaijan still prefers bilateral deals with Brussels, notably in the energy sector; and Belarus unilaterally pulled out of the framework in 2021, after its standoff with the EU following the presidential election in 2020, which was widely seen as rigged, and the subsequent crackdown on civil society and opposition in the country.
• Possibly the biggest sign that the Eastern Partnership is in decline is that there hasn't been a high-level summit for two years now. Normally, the EU would hold a summit every other year, and Sweden, which held the six-month rotating presidency of the Council of the European Union earlier this year, was approached. However, Stockholm -- which co-conceived the whole idea of the partnership in the first place -- declined the offer, with Swedish diplomats telling me that there wouldn't be any deliverables.
• There has been talk in Brussels that Poland, the other co-founder of the Eastern Partnership, is keen to host a summit when they have the presidency of the Council of the European Union in the first half of 2025. But the question is if the six partners are keen and if it won't end up being another "box-ticking exercise," as some diplomats fear.
• That was what essentially happened at the last summit, held in Brussels in December 2021. There was a working session that lasted a couple of hours and then a short working dinner. Then the whole thing was over with minimal fuss. Looking at the summit declaration, there was no mention of Russia whatsoever. Nor were there any specific lines dedicated to any of the many frozen or hot conflicts in the territories of the eastern partners. Looking back at media reports from the time, most of the focus was given to Belarus's empty chair and Ukrainian President Volodymyr Zelenskiy trying to cajole EU leaders into adopting sanctions on Russia immediately, due to the build-up of Russian troops on the border with Ukraine.
• What holds the Eastern Partnership together, other than just a bureaucratic reluctance to kill it off? Some point to the fact that the foreign ministers of the five current members will meet their EU counterparts in Brussels on December 11 with the hope of agreeing on a cell-phone roaming zone among the five countries that would eventually be extended to the EU. So, there is that.
• The Eastern Partnership will probably hobble on for a while. The framework has already borne fruit, with increased cooperation between the EU and partner countries, particularly in the energy sector. The more sanguine diplomats and EU officials see other areas, such as security, that can be explored further.

Looking Ahead

On December 7-8, the presidents of the European Council and the European Commission, Charles Michel and Ursula von der Leyen, respectively, will head to Beijing for the EU-China summit. Expect the EU to ask for China to play a more constructive role in the Ukraine war, notably by pressuring Russia on abducted Ukrainian children or prisoner exchanges, as well as taking a harder line on sanctions circumvention. In return, Beijing will likely ask the EU for more cooperation on research and development and for an increase in trade between the two sides.

EU interior ministers assemble in Brussels on December 5. One of the items on the agenda is whether a green light can finally be given to Bulgaria and Romania to join the visa-free Schengen zone. It is expected that the pair will be disappointed once again. Some EU officials, speaking on condition of anonymity as they weren't authorized to speak on the record, were annoyed that the Bulgaria and Romania request was even on the agenda, especially as one of the key opponents, the Netherlands, doesn't have a functioning government yet after Geert Wilder's far-right party got the most seats in recent parliamentary elections.

That's all for this week. Feel free to reach out to me on any of these issues on Twitter @RikardJozwiak, or on e-mail at jozwiakr@rferl.org.

Until next time,

Rikard Jozwiak

If you enjoyed this briefing and don't want to miss the next edition, subscribe here

Welcome to Wider Europe, RFE/RL's newsletter focusing on the key issues concerning the European Union, NATO, and other institutions and their relationships with the Western Balkans and Europe's Eastern neighborhoods.

I'm RFE/RL Europe Editor Rikard Jozwiak, and this week I'm drilling down on an upcoming OSCE meeting in Skopje, which is likely to be contentious, and whether the EU will be able to keep warm this winter.

Brief #1: With The Ukraine War, The OSCE Is At An Impasse

What You Need To Know: Two big questions loom over the Organization for Security and Cooperation in Europe (OSCE) ministerial meeting in Skopje on November 30-December 1, which will bring together the foreign ministers from the 57 members of the Vienna-based organization.

Firstly, will one of them -- Russia's Sergei Lavrov -- show up? And secondly, who will take over the one-year OSCE rotating chair for 2024 after North Macedonia?

The two questions are somewhat linked. Lavrov was barred from attending the ministerial meeting in the Polish city of Lodz last December, with Poland -- the organization's chair that year -- justifying the ban by saying that he was on the EU sanctions list after Russia's full-scale invasion of Ukraine in February 2022.

The thinking this time around -- at least among some member states -- is that it could be useful to have Lavrov in the Macedonian capital. The OSCE remains the only larger political organization in Europe in which Russia is still a member, having been expelled from the Council of Europe last year.

Apart from potentially confronting Lavrov over Ukraine, OSCE diplomats might desire the Russian foreign minister's presence in Skopje to help solve the problem of who should take over the chair of the organization next year.

Estonia is the only candidate -- having applied already back in 2020 -- but Russia has always rejected this and is set to do so again this year. The argument Moscow has put forward is that it doesn't want another NATO country as chair -- following on from North Macedonia and Poland -- and has accused both countries of constantly bringing up "Russia's ongoing aggression against Ukraine" at the weekly OSCE Permanent Council, where ambassadors to the organization meet. In various OSCE forums, North Macedonia and Poland have rejected the idea that there can be "business as usual" as long as the conflict goes on.

Deep Background: Normally, the chair is decided at least a year in advance via unanimity among member states. It would be unprecedented for the OSCE to enter a new year without a country at the helm -- a scenario that could even usher in the demise of the entire organization.

It has already been decided that Finland will chair the OSCE in 2025, to mark the 50th anniversary of the Helsinki Final Act of the Conference on Security and Cooperation in Europe (CSCE) -- the predecessor of the OSCE -- that aimed to improve relations between East and West and which committed the Soviet Union to formally observing human rights and international law. The decision for Finland to chair in 2025 was made well before the country became a NATO member.

So, how to solve this impasse?

Estonia is so far not withdrawing its candidacy and has received full backing from the other 26 EU member states -- including the bloc's foreign ministers when they met in Brussels on November 13. Speaking to RFE/RL after the meeting in Brussels, Estonian Foreign Minister Margus Tsahkna said: "We cannot normalize relations with the aggressor. We must continue the international isolation of Russia and must not submit to its provocations and blackmail. I am glad that the EU unanimously supports Estonia."

It will be interesting to see if this position prevails in the run-up to the Skopje meeting. The united EU stance on Estonia has so far prevented the search for alternative chairs, especially among non-NATO EU members. Perhaps the most natural choice would be Austria, as it already hosts the organization in Vienna. But there have also been talks between 2024 chair North Macedonia and Malta about the possibility of Valletta picking up the OSCE baton at the last minute, even though the country's small diplomatic service might struggle.

From what I understand from sources familiar with the issue who wish to remain anonymous, it appears that Russia has rejected another possible candidate, Kazakhstan, from chairing, or North Macedonia continuing in the hot seat for another year. If Russia doesn't get its way, then it could walk away from the OSCE, a scenario that many member states are keen to avoid.

One concern is that if Russia left, other countries -- particularly from the former Soviet bloc -- could follow, in solidarity with Moscow. At the same time, the organization is also keen to avoid being without a chair, especially as the yearlong role is key for the daily functioning of the organization.

Drilling Down

• Ahead of the Skopje meeting, pressure could increase on Estonia to withdraw its candidacy. A policy note from the United States directed to EU member states, which was seen by RFE/RL, underlines that "the United States appreciates Estonia's willingness to serve as 2024 chair and supports Estonia as a principled and capable candidate for a future chairpersonship." The note adds that "Russia has made clear it will not join consensus on another NATO member as chair" and that the "OSCE urgently needs to identify a country capable of gaining consensus to serve as chair in 2024. A failure to do so is a victory for Russia."
• It is also worth considering the presence of Lavrov himself at the ministerial meeting in Skopje. Last year, Poland acted on its own and stopped him from entering the country several weeks in advance, saying he was on the EU's sanctions list. The same could apply to North Macedonia, which as an EU candidate country has aligned with the EU's sanctions on Russia. But there's a catch: The EU has only imposed an asset freeze on Lavrov and not a visa ban. And even if there were a visa ban, this can be waived by EU member states and aligned countries in order for the Russian foreign minister to attend international conferences. Lavrov could, in other words, be welcome in North Macedonia without the country violating any legal or political obligations.
• EU foreign ministers also discussed Lavrov's presence in Brussels last week. Some -- notably from the Baltics states -- expressed shock at his potential invitation, but others -- such as Germany -- said that everyone should be there and everyone should speak to him.
• Some OSCE members, particularly from Western Europe, are hoping that Lavrov's presence would be an opportunity for dialogue, even if it's just discussions on internal OSCE matters, such as the question of extending the mandate of the secretary-general.
• Ukraine and others, however, are warning of giving in to Russian pressure. They have noted how Moscow has obstructed several important OSCE initiatives in recent years, such as blocking three field missions to Ukraine and, for the last two years, the entire OSCE budget.

Brief #2: Will EU Citizens Stay Warm This Winter?

What You Need To Know: It was supposed to be Russia's most powerful weapon against the EU after last February's invasion of Ukraine: the threat that the bloc's citizens would freeze over the winter.

While energy prices did soar at the end of summer and early fall in 2022, mostly due to a scorching heat wave and Russia squeezing gas supplies. The media was full of stories of how badly the EU would cope, painting dire scenarios for the winter of 2022-23 and warning about potential blackouts for private households and industries. Fast forward a year and the doom and gloom is nowhere to be seen -- neither in the media nor among political circles in the European Union. The consensus seems to be that EU citizens will be warm in their homes and workplaces this winter, in what could be described as one of the bloc's true success stories in recent years.

Deep Background: At the start of Russia's full-scale attack on Ukraine in 2022, imports of Russian gas by pipeline made up 40 percent of all EU gas imports. Today, that figure is down to 13 percent. The EU has blocked 90 percent of Russian oil from entering the bloc and is starting to completely phase out purchases of Russian coal. This created a price shock in the summer of 2022, with gas prices peaking at 294 euros ($320) per megawatt hour (MWh) in August that year and electricity prices reaching 474 euros per MWh around the same time.

So far this year, the average price in the EU for gas has been 44 euros per MWh and 107 euros per MWh for electricity -- a considerable drop that has led to the EU fulfilling its target of having its gas storages 90 percent full two months before the November 1 deadline. These storages are now around 99 percent full, making blackouts this winter unlikely, even in the event of a Russian cutoff or a prolonged cold snap.

How did the EU achieve this? Well, the bloc reduced gas demand by around 15 percent compared to last year. Partly this was due to households and companies consuming less due to higher prices, plus the winter of 2022-23 and fall of 2023 were fairly mild. Another contributing factor was the installation of over 3 million heat pumps across the EU in 2022 alone, which has helped to slowly lower gas consumption for the generation of power.

Drilling Down

• The main challenge for the EU has been to find alternative energy sources to replace Russian gas. In this regard, Brussels has fared reasonably well. One of the issues that made the energy crisis so alarming over the summer of 2022 was that over half of France's 56 nuclear reactors were shut down due to maintenance work. Now, many of those are back online, alleviating the problem to a certain extent. According to the European Commission, there has also been record use of solar power and offshore wind farms. While these renewable sources are helping, the main lifesaver for the EU has been the purchase of liquefied natural gas (LNG), with imports from the United States increasing sixfold since last year.
• The EU has driven LNG prices down by having the European Commission organize three rounds of joint purchasing of the gas, instead of having individual member states competing to bid. The EU has also been lucky that LNG demand in China has shrunk due to slowed economic growth there, meaning that tanks carrying LNG could quickly be rerouted from Asia to Europe.
• This means that the EU now has excess reserves going into the winter, with some LNG tankers functioning as offshore storage facilities. Some gas is also being kept in Ukraine, which has some of the largest gas stores on the continent and are far from the front lines of the war.
• The problem with the LNG market is that prices are volatile and sensitive to all sorts of external shocks. In recent months, prices have shot up due to strikes at Australian LNG facilities, repair work at a large gas processing plant in Norway, and the war in the Middle East, which has stopped work at a facility off the Israeli coast.
• There is also increased fear of sabotage, something that both NATO and EU officials are monitoring carefully since it appeared that in October a Chinese-registered vessel damaged an undersea gas pipeline connecting Estonia and Finland. It hasn't been established yet whether this was intentional or not.
• There is also an elephant in the room. While the EU has cut a lot of Russian pipelined gas, it has in the same period increased its purchase of Russian LNG by 40 percent. About 15 percent of all EU LNG imports now come from Russia, with Portugal and Spain using a considerable amount as the Iberian Peninsula is something of an energy island with very few interconnectors to the rest of the EU. The reality is that the Kremlin will continue to enjoy a share of the EU energy market. Despite repeated calls, Russian LNG will not be sanctioned by Brussels. In a proposal for new EU sanctions on Moscow, seen by RFE/RL last week, there are no proposed measures on Russian gas, whether it's shipped via pipeline or as LNG.

Looking Ahead

Keep an eye out for the Dutch parliamentary elections on November 22. Dutch politics tends to be notoriously messy, with over a dozen parties making up the chamber and months usually needed -- postelections -- to cobble together a viable coalition. These elections came about after the current coalition fell apart in the summer over how to handle increased migration, which ended with the resignation of Prime Minister Mark Rutte. Having run the country for 13 years, making him one of the longest-serving leaders in the EU, Rutte said he was leaving politics but didn't rule out the possibility of taking on a position such as NATO secretary-general or president of the European Council.

Current NATO Secretary-General Jens Stoltenberg will tour the Western Balkans this week. He will first go to Bosnia-Herzegovina, which has been aspiring to join the military alliance for well over a decade but has failed to make much progress, largely due to objections from the Serb-dominated Republika Srpska. Stoltenberg will also visit Kosovo, home to the NATO-led international peacekeeping force KFOR, which was recently bolstered due to tensions between Serbia and Kosovo.

That's all for now. I'm off this week, so the next briefing will come out on December 4. Feel free to reach out to me on any of these issues on Twitter @RikardJozwiak, or on e-mail at jozwiakr@rferl.org.

Until next time,

Rikard Jozwiak

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