Professor Gardner discusses Ukraine's rise since its 'dramatic' recession in the 90s. He interprets this particularly from the perspective of the economy while examining other factors such as football and Ukraine's relationship with Russia. Professor Gardner also looks at Ukraine's integration with Europe and possible ascension into the EU.

Synopsis

Professor Gardner discusses Ukraine’s rise and possible ascension into the EU. Initially, he focuses on the dreadful state of the Ukrainian economy throughout the 1990s, with 20% lost before its independence and a steady 9% annual loss in growth. Gardner identifies the turning point as 2000 where Prime Minister Yushchenko’s reform package transitions the country onto a growth path, now steadily growing at an annual 7%. However, although Gardner says the country has caught up what it has lost, it is still below the transition country average and faces both internal and external challenges. These include skyrocketing inflation, large current account deficit, depreciation of currency, and a substantial trade deficit. In addition, Ukraine’s internal political chaos has led to unreliability in the country’s policy constancy. Externally, Ukraine is caught between a reluctant EU and an aggressive Russia as Dr. Gardner puts it.

The latter half of Professor Gardner’s talk focuses primarily on Ukraine’s integration with Europe. He notes the various ratings Ukraine receives as a transition country in the European Bank for Reconstruction and Development (EBRD). Overall, Ukraine received a three out four in the transition index. He explains increasing mobile phone use, bank reform, small scale business success, and price liberalization as Ukraine’s strengths on the scale. On the other hand, Ukraine’s weaknesses lie partly in its competition policy and the riskiness of the Ukrainian Stock Exchange. He also cites various key integration signals such as Ukraine’s co-hosting of the 2012 Euro Championship football tournament and its exports to Europe. Professor Gardner believes for Ukraine to make the EU list it will have to raise its EBRD score and rewrite its constitution.

Prof. Gardner also kindly took questions and further discussed a variety of issues. One notable point was that when asked what single move could substantially shift the nation forward and away from Russia, Professor Gardner identified further opening the trade relationship with Europe by reducing trade barriers as key. He also addressed internal political conflict, language issues, and referendums.

This event is sponsored jointly by the Center for Russian, East European and Eurasian Studies and the Forum on Contemporary Europe.

Tensions between President Yushchenko and Prime Minister Tymoshenko came to a head in September, and the Orange parliamentary coalition broke up. What does this mean for Ukraine's political future, and for its ability to meet its key foreign policy challenges?

Steven Pifer is a visiting fellow at the Brookings Institution and a (non-resident) senior adviser with the Center for Strategic and International Studies. A retired Foreign Service officer, his more than 25 years with the State Department focused on U.S. relations with the former Soviet Union and Europe, as well as on arms control and security issues. His assignments included deputy assistant secretary of state in the Bureau of European and Eurasian Affairs (2001-2004), ambassador to Ukraine (1998-2000), and special assistant to the president and National Security Council senior director for Russia, Ukraine and Eurasia (1996-1997). He also served at the U.S. embassies in Warsaw, Moscow and London, as well as with the U.S. delegation to the Intermediate-Range Nuclear Forces negotiations in Geneva. He holds a B.A. in economics from Stanford University, where he later spent a year as a visiting scholar at Stanford's Institute for International Studies. He is a member of the Council on Foreign Relations.

This event is jointly sponsored by the Forum on Contemporary Europe and the Center for Russian, East European and Eurasian Studies.

Professor Hedlund explores a shift in focus in Europe away from the 'Brussels vs. Moscow' attitude by proposing strategic interaction in what he calls the 'corridor countries.' He discusses why there is a variety of outcomes in terms of economic success in these countries, in particular the strain of rapid deregulation in 1991 in the Soviet Union. Professor Hedlund also examines the challenges for these countries in Europe now.

Synopsis

In 'Creating a New Europe,' Professor Hedlund begins by discussing the choice the European Union had when they met in the Netherlands in 1991. He argues policymakers could have widened the concept of European integration through free trade and economic cooperation which would have led to unlimited expansion options towards the East. However, Prof. Hedlund argues they decided instead to deepen this notion of 'the United States of Europe' through a currency, flag, and constitution leading to an exclusionary approach. Now, in 2008, there is new opportunity with new members in the EU. Problems such as Russia's interaction with its neighbors which were formerly seen as external issues are now internal issues affecting Brussels. Rather than being 'grateful children' as Jacques Chirac infamously put it, these 'corridor states' are decentralising the game between Brussels and Moscow. Prof. Hedlund argues we must look for more substantial success in internal dynamics in these 'corridor states,' states which were formerly part of the U.S.S.R. and are now part of the EU or are hoping to be in the near future. To Prof. Hedlund, these states are in a good position to act as credible brokers for strategic interaction between the EU and Russia, as well as between each other, such as Lithuania's intervention during the Orange Revolution.

Prof. Hedlund explains how these ‘corridor countries’ were seen as homogenous in 1991 but now have a great diversity in economic outcomes. Much of this can be attributed to the over eager embracement of a market economy by Russia in 1991 and the hardship it caused. In addition, Prof. Hedlund identifies the corrupted markets which exploited the natural resources available following the collapse of the Soviet Union. Moreover, Prof. Hedlund cites that the ‘rent seeking’ attitude of the Russian government was not reciprocated in all former Soviet states. Some were arguably lured by the prospect of EU membership while others might have drawn in by the examples of the successful and democratic Western countries.

To Prof. Hedlund, the challenge now is to develop forward movement in the areas of the ‘corridor countries’ that have become stalled. In addition, some of the markets in those areas must be developed away from their, as he puts it, ‘3rd world’ manners of operating. Accountability is crucial to a functioning economy to Prof. Hedlund. Finally, these ‘corridor countries’ can help in democracy building.

In taking questions, Prof. Hedlund further reiterates his belief in the necessity of accountability. In addition, he touches on his sense that European education is waning, and that this is setting back innovation. Moreover, Prof. Hedlund addresses the merits of a variety of diplomatic approaches.

About the speaker

Stefan Hedlund is an Anna Lindh Research Fellow at the Stanford Forum on Contemporary Europe. He is professor of Soviet and East European Studies at Uppsala University, Sweden. Before 1991, his research was centered on the Soviet economic system. Since then, he has been focusing on Russia's adaptation to post-Soviet realities. This has included research on the multiple challenges of economic transition as well as the importance of Russia's historical legacy for the reforms. With a background in economics, he has a long-standing interest in problems related to the Soviet economic system, and the attempted transition that followed in the wake of the Soviet collapse. More recently, his research has revolved around neo-institutional theory, and problems of path dependence. Among sixteen authored and coauthored titles in English and Swedish, he is the author of Russian Path Dependence (2005), and the forthcoming co-edited volume Russia Since 1980: Wrestling with Westernization (Cambridge, 2009.) Professor Hedlund has received numerous awards including fellowships at the Davis Center for Russian Studies, Harvard University; the Slavic Research Center, Hokkaido University; and at the Kennan Institute, Washington DC.