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Russia's future: the choices for the new President

A Note by the Director (Ditchley 2008/07)
 
27-29 June 2008
Ditchley’s mid-summer conference took on the daunting subject of Russia’s future, three months after the election of President Medvedev and with the pointers to the direction of change in Russia still very unclear.  It was a significant challenge for a two-day discussion, as Russia can be connected with a very wide range of issues.  We also had to acknowledge that there were a large number of different Russian perspectives, not all of which could be represented around the table.  But we were well served by the Russians who joined us and by the broad spread of international expertise amongst the non-Russians.  The huge area covered inevitably left us with more questions than reliable answers.
The conference was clear that it had to start with the legacy of Vladimir Putin.  Would the next phase, under President Medvedev, be consolidation or adaptation?  The current division of functions between the two men, from the evidence available so far, was regarded as an unusual arrangement in a country with an authoritarian tradition.  We asked whether this system at the top would encourage progressive change in Russia as the 21st century brought its pressures to bear, or whether it would stifle it.  To what extent was the leadership accountable to the people at a stage when democracy was still developing?  Did top-down control weaken the state’s capacity to respond to people’s needs, which were considerable, and to popular expectations that rose as society became more prosperous and demanding? 
There were similar questions on the economic front.  Would diversification beyond the energy sector towards a knowledge-based economy be vigorously pursued?  Would Russia’s education system be up to the challenge?  Where would investment, particularly domestic investment at the current level of oil prices, go?  To what extent could Russia become internationally competitive? 
As for Russia’s international position, could we identify what role Russia was seeking in the world?  The government’s current assertiveness was unquestionable, but was the country striving for the status quo or a re-balancing of the international system that would allow Russia to play the global role to which it felt entitled?  What were the principal areas of focus in Moscow’s foreign policy?  We were agreed that Russia’s neighbourhood was of primary importance, as were its relationships with leading world powers, but did Russia validly see itself as an independent power with a much wider global reach?  Connected with this were questions about the views on Russia of outsiders.  How should the West, in particular, position itself with the Russia of the Medvedev-Putin era?  What should be the strategic aim:  to constrain, to roll back, to engage, to integrate Russia into a more collective world community?  Were we right sometimes to by-pass Russia?  Should it be a principal aim to avoid confrontation or should Russia be faced up to when it overstepped the mark? 
In searching for answers we looked first of all at the internal situation.  Participants thought that the process of Putin’s succession was still far from over.  It was not yet clear that there were truly “two centres of power” – or, if there were, that such an arrangement would last for long.  Most people felt, nevertheless, that personalities mattered more than institutions and that the interplay within the Kremlin had quite a way to run.  Even beyond the question of the leadership, there was significant dynamism in the situation.  The economy was cash-rich but over-dependent on oil and gas;  the rule of law and property rights were still politically contingent;  huge inequalities existed in the economy and in society;  standards of education and of healthcare were far too low;  corruption seemed endemic;  and Russia faced a long-term demographic decline, not least in Siberia.  With change undoubtedly in the air, participants thought that the various component parts of change were not in phase.  This might well mean that a threshold point was approaching, when economic opportunity and democratic development, partly influenced by external factors, might bite in tandem, even within a controlling political environment. 
While there was a case for believing that Russia was not alone in passing through a period of transformational change, the conference was interested in what was unique about the Russian character, or “Russian-ness”.  There were different views on the importance of its effect on the nature of change in Russia, but no-one was in any doubt that the Russian people had a strong attachment to their history and culture, to a degree which made them at times highly resistant to outside pressures.  Participants also pointed out the distinction that needed to be made between ethnic nationalism in different parts of the Russian Federation and Russian nationalism itself.  It was observed that, to some extent, Russia defined itself by what the West was not;  and this inhibited Russia’s integration into the channels of globalisation.  But it was also pointed out that Russia was by no means cutting itself off from the rest of the world:  involvement in the principal global institutions, soon likely to include the World Trade Organisation, was an important feature of Russia’s international presence.  While wary of the pressures coming from external change, the government thought it could manage their impact.  Connected with this discussion was the question of whether Russia, as the country developed further, would lean more towards Asia or the West as its political relationships and economic requirements evolved.  When we considered the nature of the Russian economy and the fact that a high proportion of the Russian population lived West of the Urals, few people doubted that a Western, and specifically a European, inclination would be more likely. 
The conference examined in more detail how this internal scenario interacted with external factors.  In this respect, Russia’s key strategic aim was seen as being to enhance its economic weight, as a basis for international influence and respect.  Nonetheless history and internal politics would have a lot to contribute independently of economics.  And such a large territory, lacking the population to fill it, would have some natural vulnerabilities.  These parallel perceptions of a confident but also a defensive Russia played through our discussions. 
Participants saw the external issues which most immediately affected Russian decision-making as being linked to the “near abroad”.  Whether fully justified or not, Russians retained some deep concerns that the West wanted to challenge its historical domination of its neighbourhood, or even to surround and encroach on its territory and people.  In some potential scenarios, this might lead to serious conflict.  The discussion constantly came back to Moscow’s deep resentment of the idea of NATO membership for Georgia and especially Ukraine.  There were strong conflicting arguments:  about the right, in an increasingly free world, of sovereign countries to choose their own future alliances and relationships;  and, on the other hand, about the need for the West to recognise the strategic cost, when the relationship with Russia was so important in other respects, of pressing ahead with NATO membership for these countries.  Even full-scale engagement and consultation with Russia on this issue would not offer a smooth solution in the foreseeable future.  There were calls in our concluding session for NATO to set this issue to one side for the time being, until we were clearer about the right comprehensive strategy for US-Russian and EU-Russian relations. 
The EU-Russian relationship proved highly topical, as the conference coincided with the EU-Russian Summit.  The development of the relationship was of high importance to Russia, though we could not yet say that a partnership had been established, even in the energy sector.  The EU itself comprised a variety of different national approaches to Russia, with Germany’s being perhaps the most influential as well as the most appealing to the Russians themselves.  This encouraged Moscow to continue to deal bilaterally with member states.  The majority agreed that there was a great deal of work for both sides to do, with a lot of value contained in getting it right.  There was a need for more strategic vision to give energy and direction to what remained a rather ponderous process of engagement.
Turning to Asia, we noted that Russia’s Eastern relationships were beginning to evolve in a more pragmatic way.  Perhaps this was because reciprocity of interests was easier to establish than in the West.  Both China and Japan appeared to be in a mood to help with the development of Russia’s Far East, though from different historical and political positionings respectively.  It had to be recognised that China was more of a threat to Russia in the longer term, as its economy outgrew Russia’s and with its huge population facing an empty Siberia.  But the Shanghai Cooperation Organisation had proved to be a useful initiative and there was every reason to believe that Russia and China would work out some sensible collective approaches, not least in the energy field. 
As for the US-Russian relationship, some of the shadows of the Cold War era still extended over the present day.  There were times when both sides pretended to be equals, though nuclear military capability was the only real reason for that.  Some believed that Russia liked to be seen as a key counterbalance to the United States in the world, with consequent frustrations when this was not borne out.  Yet we also thought that Washington had not yet clearly defined what it wanted in the medium to long term from its relationship with Russia, any more than Russia had in the other direction.  It was pointed out that Russia should not have to worry any longer about the United States as a European power, not just because there were many fewer US troops there.  Other, more global, factors were coming into play, not least the rise of China, which substantially altered the focus of twenty ears ago.  We thought about the opportunity for the next US Administration in this area, but concluded that Russia, at least as a bilateral partner, would not be amongst the highest priorities on the next President’s list.
Yet the conference felt that there were broader reasons for coming to terms with Russia’s independent strength, even if it did not have a global reach.  The value of having Moscow on board when it really mattered, for instance on Iran (a critical issue), or the world’s energy market, or climate change, or arms control, or terrorism, had to be calculated against Russian demands for global power status in other respects.  Russia, for its part, might need to understand that it was a less strong player on world economic and financial issues, on Africa and other development questions, on global institutional reform, or on some of the regional questions affected by state failure or poor governance. 
Against that background, the majority of participants in this debate expressed a preference for consistent engagement with Russia, but with a recognition of the realities and a readiness to be sceptical about some of Russia’s demands.  Moscow would occasionally need to be tested where their case was weaker, including on human rights.  But we strongly felt that the tone of links with Russia must be one of openness and respect.  This would mean improving our diplomatic and other institutional machinery in-between the summits and other high-level meetings.
Relevant to this was the wise advice from one Russian voice to distinguish more clearly between what Russians thought (often heavily tinged with frustration), what Russians said (often quite aggressive and damaging) and what Russians actually did.  It was pointed out that in the recent period Russia had never overtly threatened the use of force, even in the near abroad.  A sober calculation along these lines would illuminate the advantages of  a strategy which reduced competition and increased partnership between Russia and the West.  This would be easier to implement in practice if both sides focussed on legitimate interests rather than trying to correlate values.  That said, we had to acknowledge that, in an unpredictable world, events themselves would have their say. 
As examples of what this might mean in policy terms, different parts of our discussion offered the following: 
  • Other powers should engage more systematically with Russia on certain global issues, such as energy and climate change; 
  • The full implications of what Russia could offer to a solution to, or improvement in, the Iran nuclear question should be explored;
  • Western countries should offer detailed help with Russia’s entry into the WTO;
  • The next stages of NATO membership expansion to the East should be allowed time to develop.
We were also conscious, in covering such a large territory, of a number of omissions.  Chechnya was one of these, not just as a burning question on the internal Russian scene, but also in its international and human rights implications, and in its effect on the attitude of the Islamic world to Russia.  We acknowledged that we had not gone deeply into the role of religion, and especially the Orthodox church, in Russian society and indeed in the Russian psyche.  We did not touch on the role and significance of the Russian intelligence services, still active internally and externally.  Nor did we calculate the growing impact of Russia’s financial reserves and the establishment of a sovereign wealth fund.  Perhaps the greatest lacuna was to omit a discussion of the attitudes and ambitions of Russia’s younger generation, whose response to globalisation would in the longer term be critical and whose desire for international interconnectedness might become an increasingly important trend. 
Even recognising what we had missed, people concluded that there was a lot of value in what we had covered.  We did not settle on any clear conclusion about Russia’s future, but there was a noticeable trend towards qualified optimism in our final session, with the majority seeing opportunities rather than dark clouds.  If, on the internal scene, both rulers and ruled wanted to avoid shocks, then the Russian environment might be one of greater cautiousness than all the noise suggested.  Externally, we felt clearer after this debate about the pressures and preoccupations affecting Russia from outside.  If the majority felt that engagement as potential long-term friends was the right approach, that was good news, but it required a more decisive shift of vision in our governments away from a zero-sum into a partnership agenda.  For this encouraging result, Ditchley has to thank the wealth of expertise represented around the table and, in particular, the guiding hand of an experienced and thoughtful Chairman.  What we learnt at this event will connect with most of Ditchley’s subject-matter over the coming period.
This Note reflects the Director’s personal impressions of the conference.  No participant is in any way committed to its content or expression.
 
PARTICIPANTS
Chair  :  Dr Alex Pravda
Souede-Salameno Fellow, St Antony’s College, Oxford;  Director, Russian and Eurasian Studies Centre (2008-09);  Lecturer in Russian and East European Politics, Oxford University (1989-);  Associate Fellow, Russia and Eurasia Programme, Royal Institute of International Affairs, Chatham House (2005-).
 
CANADA
Mr Kevin Lynch

Clerk of the Privy Council;  Secretary to the Cabinet;  Head of the Public Service of Canada (2006 ).
CANADA/UNITED STATES OF AMERICA
Ms Pamela Jordan

Associate Professor of History, University of Saskatchewan (2003-).
CANADA/UNITED KINGDOM
Mr Piers Cumberlege

Vice-President, Private Equity, Cordiant Capital;  Chairman, Canada Eurasia Russia Business Association.
CHINA
Professor Feng Shaolei

Professor, School of Advanced International and Area Studies, East China Normal University.
EUROPEAN COMMISSION/ESTONIA 
Mr Alar Olljum

Head of Unit, Forward Studies, European Commission Directorate General for External Relations (2006-).  Formerly:  Deputy Director, Secretariat of the Council of the Baltic Sea States, Stockholm (2001-05).
EUROPEAN UNION/FRANCE
Ambassador Pierre Morel

 rench Diplomatic Service (1971-);  EU Special Representative for Central Asia, Brussels (2006-).
FRANCE
Ambassador Philippe de Suremain

Member, Scientific Council, Fondation Robert Schuman, Paris.  Formerly:  French Diplomatic Service (1964-07);  Ambassador to Ukraine (2002-05).
Professor Marie Mendras
Professor, Sciences Po University, Paris;  Research Fellow, Centre National de la Recherche Scientifique, Paris;  Chair, Observatoire de la Russie;  Editor, The Russia Papers.
GEORGIA
Professor Alexander Rondeli

Ambassador Extraordinary and Plenipotentiary;  President, Georgian Foundation for Strategic and International Studies, Tbilisi (2001-).  Formerly:  Director, Foreign Policy Research and Analysis Center, Ministry of Foreign Affairs of Georgia (1997-2004).
GERMANY
Professor Michael Stuermer
Chief Correspondent, Die Welt and Welt am Sonntag (1998-);  Professor Emeritus of Medieval and Modern History, Friedrich-Alexander-Universität, Erlangen-Nürnberg (1973-);  Member, German Advisory Council, J P Morgan Bank (1990-).
JAPAN
Ambassador Yasuo Saito

Japanese Ministry of Foreign Affairs (1971-);  Ambassador of Japan to the Russian Federation (2006-).
Ambassador Yukio Satoh
President, Japan Institute of International Affairs, Tokyo.  Formerly:  Permanent Representative of Japan to the UN (1998-2002).
RUSSIA
Professor Dr Oxana Dmitrieva

Deputy for St Petersburg, State Duma, Russian Federation;  Professor, St Petersburg University of Economics and Finance.
Mr Leonid Grigoriev
President, Institute for Energy and Finance, Moscow.
Dr Alexey Gromyko
Deputy Director, Institute of Europe, Russian Academy of Sciences;  European Programmes Director, Russkiy Mir Foundation.
Ambassador Nikolay Spasskiy
Deputy Director-General, State Corporation Rosatom (2008-).  Formerly:  Deputy Head, Russian Atomic Energy Agency (2006-08).
SLOVAKIA
Mr Pavol Demes

Director, German Marshall Fund, Bratislava Office (2000-).  Formerly:  Director, Department of Foreign Policy, Office of the President of the Slovak Republic (1993-97).
UNITED KINGDOM
Sir Michael Arthur KCMG

HM Diplomatic Service (1972-);  Ambassador to Germany (2007-).  Formerly:  British High Commissioner, New Delhi (2003-07);  Director General, EU and International Economic Issues (2001-03).
Mr Lionel Barber 
Financial Times:  Editor (2005-).  Formerly:  Managing Editor, United States (2002-05);  European Editor (2000-02).
Mr Michael Binyon OBE
The Times (1972-);  Chief Foreign Editorial Writer (2003-);  Diplomatic Editor (1991-).
Sir Rodric Braithwaite GCMG
Chairman, International Advisory Council, Moscow School of Political Studies (1997-).  Formerly:  Senior Adviser and Managing Director, Deutsche Bank, AG, London (1994-2002);  HM Diplomatic Service (1955 93).  Chairman, Programme Committee and a Governor, The Ditchley Foundation.
Sir Tony Brenton KCMG
HM Diplomatic Service (1975-);  HM Ambassador to the Russian Federation, Moscow (2004-).  Formerly;  Deputy Head of Mission, British Embassy, Washington (2001-04).
Mr Richard Bridge
HM Diplomatic Service (1984-);  Counsellor, London (2001-).  Previous postings in:  Geneva, New Delhi, Moscow, Warsaw.
Mrs Felicity Cave MBE
Trustee, UK Friends of the Hermitage (2003-).  Formerly:  Consultant, Brown Lloyd James/RIA Novosti (2003-05);  Interim Director, Britain-Russia Centre (2000).
Dr Paul Chaisty
University Lecturer in Russian Government, St Antony’s College, University of Oxford.
Mr David Clark
Chairman, The Russia Foundation;  Senior Research Fellow, Federal Trust;  Political Writer and Analyst.  Formerly:  Special Adviser on Europe, Foreign and Commonwealth Office (1997-2001).
Mr Michael Davenport
HM Diplomatic Service (1988-);  Director, Russia, South Caucasus and Central Asia (2007-).
Mr Charles Grant
Co-Founder and Director, Centre for European Reform (1996-);  Board Member and Trustee, British Council (2002-);  Member, Committee for Russia in a United Europe;  Advisory Board Member, Moscow School of Political Studies.  A Member, Ditchley Foundation Programme Committee.
Mr Adam Leach
Regional Director, Middle East, Eastern Europe, Commonwealth of Independent States, Oxfam.
Mr Edward Lucas
The Economist:  Central and Eastern European Correspondent
(2005-).  Formerly:  Moscow Bureau Chief (1998-2002).
Sir Roderic Lyne KBE CMG
Special Adviser, BP plc (2004-) and JPMorgan Chase Bank (2007-);  Director, Accor and Aricom;  Board of Governors and Visiting Professor, Kingston University.  Formerly:  HM Diplomatic Service (1970-2004);  British Ambassador to Russia (2000-04).  A Governor, The Ditchley Foundation.
Sir David Manning GCMG CVO
Formerly:  HM Diplomatic Service (1972-2008);  HM Ambassador to the USA (2003-07);  Foreig Policy Adviser to the Prime Minister and Head of Defence and Overseas Secretariat, Cabinet Office (2001-03).
Mr Andrew Miller
The Economist (2000-);  Political Editor (2007-).  Formerly:  International Security Editor (2002-04);  Moscow Bureau Chief (2004-07).
Mrs Anne Pringle CMG
HM Diplomatic Service (1977-);  Ambassador-Designate to the Russian Federation (2008-).  Formerly:  Director, Strategy and Information and Member, FCO Board (2004-07).
Dr Susan Richards
Editor, openDemocracy Russia.
Mrs Fields Wicker-Miurin OBE
Co-Founder and Partner, Leaders’ Quest (2002-);  Non-Executive Director:  CDC Group plc;  Savills plc;  UK Department of Business;  Director, Carnegie Group, Sweden;  Governor, King’s College, London.
UNITED KINGDOM/RUSSIA
Ms Oksana Antonenko

Senior Fellow and Programme Director, Russia and Eurasia, International Institute for Strategic Studies.
UNITED KINGDOM/UNITED STATES OF AMERICA
Dr Alan Rousso

Director, Strategy and Analysis, Office of the Chief Economist, European Bank for Reconstruction and Development, London
(2001-).  Formerly:  Director, Carnegie Endowment Centre, Moscow.
UNITED STATES OF AMERICA
Professor Timothy Colton

Morris and Anna Feldberg Professor of Government and Russian Studies, Department of Government, Harvard University (1989-);  Director, Davis Center for Russian and Eurasian Studies, Harvard University (1992-).
Dr Cliff Gaddy
Senior Fellow, The Brookings Institution, Washington DC.
Mr Jim Hoagland
Associate Editor and Chief Foreign Correspondent, The Washington Post.
Ambassador Steven Pifer
Visiting Fellow, Center on the United States and Europe, Foreign Policy Studies Program, Brookings (2008 ).  Formerly:  Senior Adviser, Russia and Eurasia Program, Center for Strategic and International Studies, Washington DC;  Deputy Assistant Secretary of State, Bureau of European and Eurasian Affairs (2001-04).
UNITED STATES OF AMERICA/RUSSIA
Professor Nina Khrushcheva

Associate Professor, Graduate Program of International Affairs, The New School, New York;  Senior Fellow, World Policy Institute;  Editor and Contributor,  “Project Syndicate:  Association of Newspapers Around the World”.