What a Deal Between Ukraine and Russia Could Look Like
Crimean and Russian Cossack volunteers
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The Fiscal Times
August 25, 2014

All eyes will focus this week on Minsk where Russian President Vladimir Putin will meet his Ukrainian counterpart, Petro Poroshenko. After coming close to armed confrontation over the aid-laden convoy Russia sent into Ukraine’s eastern region last week, the encounter in the Belarus capital Tuesday suddenly and unexpectedly presents the two sides with the their best chance yet to reach a diplomatic and political agreement settling the nine-month crisis over Ukraine’s future status and direction.

Who would have guessed? When Moscow unilaterally dispatched its 270-truck caravan across Ukraine’s border to Luhansk last Friday, Kiev denounced the move as an invasion, the Pentagon demanded the vehicles’ immediate withdrawal, and NATO reported that Russian artillery had advanced into Ukrainian territory and fired on government troops. Nightmares of East and West once more at war seemed on the brink of coming true.

Related: 12 Things You Don’t Know About Ukraine

Then Putin pulled one of his periodic surprises. On Saturday the caravan finished unloading relief supplies and swiftly withdrew across the border, along with the Russian military units allegedly on Ukrainian soil. “Putin has not done the big thing that he seemed to be threatening, which was to make his troops, his men, his trucks a shield for the separatists in eastern Ukraine,” Steve Sestanovich, a Council on Foreign Relations fellow in Washington, said on PBS Weekend Newshour.

In an instant, the Russian leader effectively transformed the outlook for the Minsk meeting, at which several former Soviet republics will convene with the European Union to discuss customs ties, trade, energy security, and the Ukraine crisis. It’s knife’s edge now: Putin and Poroshenko will either craft a deal defusing tensions, or agree on a framework for one - or they will do neither. And “neither” will be dire in that the first serious attempt to settle up politically will have failed.

A lot went into the making of this moment, not all of which is immediately apparent. This column argued six weeks ago that the relationship between Putin and German Chancellor Angela Merkel provided the best route to peace and stability in Ukraine, and the oddly sympathetic ties between these two leaders now seem about to come good.

There is a caveat, however. The success of back-channel contacts between Moscow and Berlin over the past several months now hangs on Poroshenko, and Kiev’s less-than-brilliant record for good judgment and reliability since he was elected in May is a primary source of worry in Berlin diplomatic circles, according to my contacts there. “We never know what they will say, what they will do, what they will say they will do, but what we do know is that they very seldom do what they say they will do,” a well-placed source said in an e-mail note just before the weekend.

Related: Putin Wants Eastern Ukraine—Let Him Have It

Well, with this in mind let’s look on the bright side.  

The Independent reported in late July that Merkel and Putin “have been working on a secret plan to broker a peaceful solution to end international tensions over Ukraine.” The London daily elaborated in an exclusive that the proposed settlement “hinges on two main ambitions: stabilizing the borders of Ukraine and providing the financially troubled country with a strong economic boost, particularly a new energy agreement ensuring security of gas supplies.”

There are some heavy-going clauses on the table. The international community would have to accept Russia’s annexation of Crimea last spring. Gulp. Kiev would also devolve some political and administrative powers to the eastern region. No gulp here: It is imperative that Kiev recognize the legitimacy of the Russian-majority east’s desire for greater autonomy.

The give-backs: Russia would cease its involvement in eastern Ukraine, whatever it may be, and pay $1 billion to compensate for the rent it paid for stationing its fleets in the Crimea until the region voted for independence.

Next. Poroshenko would agree not to join NATO. The trade-off here would be Russia’s commitment to accept Kiev’s new relations with the E.U. as agreed in a pact signed after Poroshenko took office. Ukraine would also get a new long-term agreement with Russia’s Gazprom covering future gas supplies and pricing - critical if Ukraine is to sustain any kind of economic recovery.

Related: EU Agrees to Russian Sanctions, US Could Arm Ukraine

The Independent characterized this deal as “land for gas.” It’s good headline copy but it’s reductionist. While there is almost certainly more to the talks, what we know of them suggests an attentive effort to discover interests that can be balanced enough to produce an enduring pact.

Over the weekend Merkel paid her first visit to Kiev since the coup that toppled Viktor Yanukovich in February. As advertised it was “to show support,” but it is almost certain the chancellor, arriving three days before the Minsk meeting, was either coaching or coaxing or shoving Poroshenko toward accepting at least the key points in the terms the Berlin-Moscow talks have now reached.

While Merkel was in Kiev, her vice-chancellor, Sigmar Gabriel, said this back in Berlin: “The territorial integrity of Ukraine can be maintained only if an offer is made to the areas with a Russian majority. A clever concept of federalization seems to be the only practicable way.”

Kiev went nearly into conniptions at the mention of a federalist solution: It is Moscow’s preference, and Kiev suspects it would weaken Ukraine in its international dealings.

For my money Gabriel’s made his gaffe accidentally on purpose. Merkel, standing by Poroshenko’s side, instantly took the occasion to profess a four-square stance against independence for the east—one of Kiev’s consuming paranoias. “What we call federalism is decentralization,” she said, and that is the term and the point she appeared determined to drive home.

Were I one of Merkel’s diplomats I would be reluctant indeed to rest my months of work on Poroshenko’s shoulders. But if there is to be a settlement of the Ukraine crisis off the battlefield, as all sides claim to want, the chance rests with Poroshenko’s decisions Tuesday and may not come again for some time if it is lost.

Footnote: In a busy week of e-mail messages, this from an entrepreneur I have known for decades and with interests in Ukraine: “We have a small team on the ground in Ukraine - four very experienced business people - and they tell us that the current regime in Kiev is at least as corrupt as all of the others in Kiev since the country was created two decades ago.”

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A correspondent, editor and critic for more than 30 years, mostly for the International Herald Tribune and The New Yorker, Patrick Smith has also lectured in journalism and media studies. He is the author of five books.