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Sanctions on Russian Oil Exports Require Further Refining

Author(s): Patryk Kugiel,Zuzanna Nowak / Language(s): English

Western and other states’ restriction of imports of Russian oil and sanctions on its oil trade had little impact on Russia’s budget revenues in 2022. This was because Russia found new customers for its crude, mainly in Asia. The effects of the restrictions only started to become apparent from the beginning of this year, but without a further, significant reduction in this source of income, Russia’s ability to fund its aggression against Ukraine will not be weakened. The best way to increase the effectiveness of the sanctions would be to further reduce the price ceiling on Russian oil and take steps to increase the oil supply on the global market from alternative sources.

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Hungary Maintains Course on Russia One Year after the Invasion of Ukraine

Author(s): Veronika Jóźwiak / Language(s): English

The Hungarian government, although in principle not blocking Allied support for Ukraine, represents a position favouring Russia. This is contrary to the strategic interests of NATO and EU partners, including Poland, and results in a growing loss of credibility of the Hungarian government in these organisations. Therefore, Hungary’s attitude will degrade its position, regardless of the resolution of the war in Ukraine. It may also hinder joint action within NATO and the EU, given their limited influence on the Hungarian government’s decisions.

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Strengthening State Security a Challenge for the Pro-European Moldovan Government

Author(s): Jakub Pieńkowski / Language(s): English

On 30 March, the Moldovan parliament began work on a package of bills reforming the Security and Intelligence Service. This is an element of the pro-European government’s response to Russia’s destabilisation of the country. In February, President Maia Sandu accused Russia of attempting an armed coup in Chişinău. However, the imminent threat of this is contradicted by the appointment of new prime minister Dorin Recean, the former interior minister, in mainly an image-related move. It is in the interest of Poland to strengthen the stability of Moldova a sit will contribute to the security of the Eastern Flank of the EU and NATO, as well as guard Ukraine from the rear.

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How the War in Ukraine Impacts NATO Policy in the Black Sea Region

Author(s): Filip Bryjka / Language(s): English

Russia’s invasion of Ukraine has increased the strategic importance of the Black Sea region for the security of NATO’s Eastern Flank. The activity of the Russian Black Sea Fleet, energy blackmail, and blocking of sea lines of communication pose a threat to the Alliance and its partner states (Moldova, Ukraine, Georgia). Although NATO’s ability to operate in the Black Sea is limited by the Montreux Convention, the Alliance can enhance deterrence credibility by increasing its military presence in the region and expanding cooperation with partners.

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Business and Consumer Protection Must Evolve after Europe’s Energy Crisis

Author(s): Piotr Dzierżanowski,Zuzanna Nowak / Language(s): English

The energy crisis has hit businesses and consumers in the EU hard. Member States took remedial action and the European Commission implemented solutions at the Community level. The EU managed to avoid economic collapse and maintain the stability needed to support Ukraine and to face Russia. Further countermeasures will need to be taken this summer to avoid another energy crisis in the winter of 2023- 2024.

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Japan Focuses Policy on Economic Security

Author(s): Oskar Pietrewicz / Language(s): English

Japan is stepping up efforts to increase its economic security. In August, some new regulations came into force aimed at strengthening, among others, the resilience of supply chains and developing technological potential. Japan is thus responding to the challenges of China’s policy, the U.S.-China rivalry, and global technological progress. Improving economic security will require the government to cooperate with both Japanese business and international partners, including the U.S. and the EU.

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China’s challenges in the Indo-Pacific in the shadow of Russian aggression against Ukraine

Author(s): Michał Bogusz / Language(s): English

The PRC has been in a difficult international position since the Russian invasion of Ukraine. The war and the unprecedented sanctions imposed on Moscow are accelerating polarisation in the world. The US global alliance system has worked effectively and there has been not only a consolidation of NATO, but also the establishment of cooperation between US pacific allies – such as Japan and Australia – and European partners. They have also delivered aid to Ukraine, which must raise concerns in Beijing that they could rely on NATO members for support in the event of an Indo-Pacific conflict. Chinese propaganda since the beginning of the war has reproduced the Russian narrative that the Alliance and Washington are responsible. The PRC is not abandoning its long-range strategic goals in the region, but the course of the aggression against Ukraine and the Western response require it to accept new realities. Above all, Beijing must recognise that the incorporation of Taiwan, which remains its priority, will not happen in the near term by means of a local ‘special operation’, but would escalate into a major international conflict for which the People’s Liberation Army (PLA) will not be prepared in the near future. Recognition of this fact has already resulted in a relative reduction in the current number and intensity of incidents across the Taiwan Strait for the time being.

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Slovakia: strategic dilemmas after the Russian invasion of Ukraine

Author(s): Krzysztof Dębiec / Language(s): English

The centre-right government in Bratislava decided to discontinue its long-standing policy of avoiding antagonizing Russia. Since the Russian invasion of Ukraine, Slovakia has found itself in the vanguard of the countries most involved in providing military and humanitarian aid to Kyiv. Bratislava has expelled 35 Russian diplomats, has closed several pro-Russian websites and intensified the activity of the secret services targeting collaborators of Russian intelligence. Nevertheless, these unprecedented attempts to rid the country of Russian influence are encountering increasing resistance in Slovakia. The opposition, which leads in the polls, is calling for Slovakia to return to the policy of avoiding ‘superpower conflicts’ and is taking increasingly open pro-Russian positions. This way it meets the mood of a large section of the Slovak public who are distrustful of the US. Inside the government, there are concerns about how a rapid end of the reliance on supplies of Russian raw materials will affect the domestic economy and this is making it difficult to reach a consensus on how quickly this should proceed. Halfway through its term in power, the centre-right parties are facing strategic decisions that will also determine their chances of re-election. If the current approach towards Kyiv and the Kremlin is maintained, Slovakia’s position in the EU will strengthen and Russia’s influence in this country may also weaken in the long run. The government, which is not very popular, will have to face the challenge of continuing the effort to become independent of Russian raw material supplies amid an economic downturn and the strong polarisation of public sentiments at home. An alternative may be the continuation of military and humanitarian support for Kyiv, while only simulating activities aimed at energy diversification.

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Germany and the crisis of globalisation: adjustment strategies

Author(s): Sebastian Płóciennik / Language(s): English

Germany is among the biggest beneficiaries of the global economic system based on free trade and on cross-border organisation of production. However, the functioning of this system has been recently disrupted by the COVID-19 pandemic, which has highlighted the vulnerability of excessively stretched supply chains. It has also been hit hard by Russia’s attack on Ukraine and by the resulting sanctions, which are aggravating supply-related problems and stoking political divisions between the major powers. All of these forces may lead to the global economy splitting into competing platforms, and to the logic of cost optimisation being abandoned infavour of risk mitigation. If this happens, Germany would face a difficult strategic dilemma and embark on one of the following three options. The first option would involve defending the increasingly unstable status quo and the benefits of exchange patterns associated with it. In the second option, Berlin could favour a political and military consolidation of the West, and at the same time let businesses operate freely and move between the competing platforms. The third option involves taking part in the creation of an alliance of democratic states, accompanied by partial de-globalisation and an overhaul of the present economic model. While this is the most radical scenario, in the context of the continuously expanding sanction regime targeting Moscow and the mounting chaos in global supply networks (caused by China’s pandemic restrictions), its likelihood is increasing.

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NATO member states on arms deliveries to Ukraine

Author(s): Justyna Gotkowska,Piotr Szymański,Piotr Żochowski,Andrzej Wilk / Language(s): English

The NATO member states do not have a common position concerning sending arms supplies to Ukraine. In January, under increasing military pressure from Russia, it was the US, the UK, the Baltic states, the Czech Republic and Poland which decided to deliver weapons and ammunition to Kyiv free of charge. Apart from being a political demonstration of solidarity, these supplies are intended to show to Russia that further military actions against Ukraine will incur increased costs. Moreover, these deliveries will strengthen Ukrainian ground forces if the Russian military operation in Donbass is expanded, but will not play a major role in the event of a full-scale invasion or missile attacks on Ukraine. Germany and some other member states are still rejecting arms supplies to Ukraine due to the fear of a further deterioration of the relations with Moscow.

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Caution and anticipation: Turkey and the Russo-Ukrainian war

Author(s): Krzysztof Strachota,Adam Michalski / Language(s): English

Turkey’s official attitude towards the Russia-Ukraine war is essentially in line with NATO’s position on the conflict (it has shown support for Ukraine’s sovereignty and territorial integrity, including in the UN, and provided material aid), but it has also avoided any actions or rhetoric which would clearly strike at Russia’s interests (no sanctions, its airspace remains open, etc.). Turkey has officially called for a political solution to the conflict (it initiated and hosted talks between the Ukrainian and Russian foreign ministers on 10 March). This policy resembles Ankara’s traditional approach: nurturing and protecting its extensive political, economic and military relations with both Kyiv and Moscow, while balancing and playing off the West’s and Russia’s interests without formally breaking ties with either side. In the current situation, this attitude appears as an expression of Turkey’s alarmed stance at the prospect that the conflict between Russia and the West might escalate; that the Turkish economy could collapse; and above all, that the war might have disastrous results for Turkey’s security in the Middle East.

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The economic consequences of the war: a profound crisis looming for Russia

Author(s): Iwona Wiśniewska / Language(s): English

In retaliation for its military aggression against Ukraine Russia has been sanctioned by around 50 countries, which accounted for half of Russia’s foreign trade and were of key importance to the stability of its capital market. The sanctions have hit the foundations of the Russian economy, principally targeting the financial market. The measures have affected every single sector of the economy, and the negative consequences of most of these measures have been immediate. Undoubtedly, this came as a major surprise to the Kremlin, especially as the scale of the sanctions considerably exceeded the scale of possible restrictions hinted at ahead of the invasion. It can be expected that as long as Russia continues to attack Ukraine, further restrictions will be imposed on it, including on its raw material sector.

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Russians Against the War: Under the White-Blue-White Flag

Author(s): Agnieszka Legucka / Language(s): English

Russians opposing the war in Ukraine use the white-blue-white flag (WBW) to identify themselves. It is used by a variety of circles, from democratic to radical, including groups admitting to guerrilla warfare in Russia and Russians fighting in Ukraine against Russian troops. Protesters against the invasion of Ukraine are a minority in Russian society. They can openly voice their views only outside the Russian Federation, so their actions do not translate into a change in Russian policy.

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Lukashenka’s last line of defence. The Belarusian security apparatus in a time of crisis

Author(s): Piotr Żochowski / Language(s): English

The political crisis which has been raging in Belarus since August 2020 and the growing public discontent with the regime have become the greatest challenge to the current government in recent history. Lukashenka has not considered the possibility of stabilising the situation by means of at least superficially holding a dialogue with society. He has resorted to repressive methods to crush the crisis and adopted a model of state management that resembles a state of emergency. The state’s internal security institutions have become the most important pillar of Belarusian authoritarianism, to a degree holding Lukashenka hostage to their vision of the world. The ever-expanding legal instruments allowing for the radical ramping up of repression against the regime’s opponents have reinforced the police state system in which all spheres of activity, not only social, but also economic and educational, have been placed under strict supervision by the KGB, the Ministry for Internal Affairs or the prosecutor’s office. This has led to the marginalisation of the civilian nomenklatura’s role, making it easier for representatives of the ministries of state power to consolidate their position in the administration. The position of the Belarusian security institutions has also been strengthened by their good relations with the Russian state power sector, especially with regard to coordinating activities against the West.

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The cost of a police state: Belarus’s economic problems

Author(s): Kamil Kłysiński / Language(s): English

Although the COVID-19 pandemic did trigger a recession in Belarus, the greatest blow to the country’s economy has been its deep political crisis. This was caused by the authorities rigging the results of the presidential election, which in turn provoked mass opposition from the citizens. Alyaksandr Lukashenka, focused on remaining in power, resorted to unprecedented repression, which over the following months completely shattered many years of efforts to improve the investment climate and to achieve a partial liberalization of the economy. These efforts included a flagship initiative to develop the Belarusian IT sector. 2020 revealed the Belarusian economy’s great sensitivity to the global economic slump and the regime’s inability to launch free-market reforms. As a consequence, although in 2020 Belarus’s GDP fell just0.9%, the country found itself in an extremely difficult situation due to the magnitude of other threats to its economic stability. Belarus’s inability to effectively refinance its foreign debt using funds offered by Western institutions, its significant budget deficit (approximating the level recorded in the crisis years of the 1990s) and the state sector’s largely unpayable debt to the local banks will all result in continued aggravation of the economic crisis. Alongside this, they will provoke a rise in Russia’s importance as the only ally and lender to an internationally isolated Belarus. Without Russia’s assistance, the risk of the Belarusian economy collapsing will increase significantly in 2021.

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Under the radar of big politics: cooperation between China and Ukraine

Author(s): Krzysztof Nieczypor,Jakub Jakóbowski / Language(s): English

Chinese-Ukrainian relations are still defined by the events of 2014: the Ukrainian Revolution of Dignity and the Russian invasion of Ukraine. Their consequences continue to block high-level political dialogue between Kyiv and Beijing, which Washington (and to a certain extent Moscow as well) also does not want. However, Sino-Ukrainian economic cooperation is expanding rapidly, with trade as its main driver. In 2019 the PRC became Ukraine’s most important trading partner due to the rapid rise in Ukrainian exports. Beijing itself is sceptical of Ukraine’s post-2014 political transition and its turn to the West, but it is interested in Ukraine’s military technologies, raw materials and agricultural potential. Since President Volodymyr Zelensky came to power, Ukraine has clearly been seeking a new opening in its relations with China, looking to widen the foreign policy space in the game between the West and Russia. However, it remains essentially excluded from financial and investment cooperation under the Belt and Road Initiative. Any significant deepening of relations between Kyiv and Beijing would first and foremost require a resolution of the Russian-Ukrainian conflict. However, the existing dynamic economic cooperation ‘under the radar’ of great-power politics still has considerable potential.

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The dispute over Nord Stream 2: the stances and the outlook

Author(s): Ryszarda Formuszewicz,Szymon Kardaś,Agata Loskot-Strachota / Language(s): English

Russian ships resumed laying the Nord Stream 2 (NS2) gas pipeline on the Baltic Sea bed in February this year. Russia’s goal is to complete the project and put it into operation as soon as possible. This coincided with media reports that representatives of Germany and the new US administration had been searching for compromise arrangements to determine the conditions for construction to be completed and operation to commence. These would include options for a moratorium on launching it but, above all, the creation of guarantees to maintain the limited transit of Russian gas through Ukraine or a ‘snap back’ mechanism enabling shutting off/limiting flows via NS2 in the event of problems with supplies or transit through Ukrainian territory. Berlin hopes to agree on the terms on which the US will tolerate the gas pipeline, or will at least play for time so that construction can be completed while the talks are underway and the certification necessary for its launch can be obtained. It is unclear what actions the Joe Biden administration will take regarding this issue. On the one hand, it has criticized the project but on the other, it has not imposed any sanctions that could stop its implementation as yet (19 March 2021) and it is striving to improve relations with Germany.

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Wrestling in Greenland. Denmark, the United States and China in the land of ice

Author(s): Piotr Szymański / Language(s): English

International interest in Greenland has been growing for several years. This trend is a result of the increasing global competition between the US, China and Russia (including in the Arctic)and the acceleration of climate change, which is opening the region up to commercial and military activity. The independence aspirations of the island’s inhabitants are also of note in this context. Copenhagen seeks to maintain sovereignty over Greenland because it strengthens Denmark’s significance in the world and provides access to the Arctic. The US has increased its visibility in Greenland due to Chinese investments, and has even considered buying it. For Beijing, the island represents a potential area of economic expansion, providing a valid argument for China to become a major player in the Arctic. This growing interest pleases Greenlanders, who see balancing between Denmark, the US and China as an opportunity for new investments and building the economic foundations of sovereignty.

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The (pan-)Turkic Caucasus. The Baku-Ankara alliance and its regional importance

Author(s): Mateusz Chudziak,Wojciech Górecki / Language(s): English

The Nagorno-Karabakh war of autumn 2020 and the military parade organized in Baku after its end, which was jointly hosted by the presidents of Azerbaijan and Turkey, Ilham Aliyev and Recep Tayyip Erdoğan, highlighted the potential of the alliance between both countries. The close ties between Baku and Ankara result from a strategic choice made almost three decades ago. The diverse activities they have undertaken to strengthen their cooperation have varied in intensity over that period, but their overall direction has remained unchanged. As a result, Azerbaijan has gradually distanced itself from Russia, and through its cooperation with Turkey, it has moved closer (albeit mainly economically) to the West. Ankara, on the other hand, has strengthened its position in the South Caucasus. This has led to the formation of an Ankara-Bakuaxis, which presents a challenge to Moscow because it limits Russian influence in the region. However, the Turkic duo has been taking care not to antagonize Russia directly; one expression of this approach is their acceptance of Moscow’s key role in resolving the Karabakh conflict.

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Seeking an additional reassurance. The EU and France in Estonia’s security policy

Author(s): Piotr Szymański / Language(s): English

Over the last few years, Tallinn has been increasingly involved in military cooperation in the EU and with France. To date, Estonia is the only country on NATO’s eastern flank to join the French-led European Intervention Initiative. The country is developing the European pillar of its security policy with a view to diversifying military cooperation, which has centred primarily around the US and UK. This is due to Estonia’s concerns about the future of their military posture in Europe. However, due to the leading role of the US and UK in NATO’s deterrence and defence on the eastern flank, working with the two countries will continue to be Estonia’s security policy priority.

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