A deep divide: The long-term EU-Russia decoupling

Russia’s invasion of Ukraine has an enormous impact on the future of the European Union. This Clingendael Spectator series analyses how Europe’s relation with Ukraine and Russia will be affected. In the second episode, Sergey Utkin analyses the transformation of the relationship between the EU and Russia from once hopeful partners into open adversaries. 

“There will be no return to the reality of 2021”, said Ivan Timofeev, Director General of the Russian International Affairs Council, earlier this year.1 A deepening divide has emerged between the European Union and Russia.

In the past decade, these once hopeful partners have turned into open adversaries. Hardly a day goes by without the news reporting on either a new package of sanctions,2 a ban on Russian cars crossing border into the EU,3 or Russia’s withdrawal from remaining European subregional organisations.4

As Russia and the EU seem to indefinitely drift apart, this article provides an overview of their relationship’s transformation and examines the potential implications. How did the divisions escalate to this extent over the past decade, and what do these developments entail for future EU-Russia relations? Can the actions taken thus far be undone, and what could be the prerequisites for that? Undoubtedly, several existing realities will hinder the potential restoration of a mutually acceptable atmosphere, let alone cooperation, between Russia and the EU for the foreseeable future.

Three decades of hope came crumbling down
When an independent Russia emerged from the Soviet Union’s ashes, good relations with the EU and its member states were a priority for Moscow. This bloc of rich and successful countries seemed a sensible source of investment, knowledge and modern savoir vivre.

The EU, in turn, needed enormous amounts of natural resources to sustain its economic activity, which Russia had in abundance. Thus, it seemed that the new hopeful partners had a near-perfect level of compatibility; both had something the other desired and required.

The invasion of Ukraine in 2022 pushed the remnants of the relationship over the edge and into a rapid fall

The trend of the EU-Russia relationship remained generally positive until 2014. Serious disagreements also occurred in the years prior, but negotiations on visa-free travel seemed to provide prospect, the EU-Russia summits continued, and the diverse cooperative agenda remained relevant.

In 2014, the annexation of Crimea and war in the Donbas reversed this trend, replacing diplomacy with sanctions as major policy instrument. The invasion of Ukraine in 2022 pushed the remnants of the relationship over the edge and into a rapid fall.

Economy: Not so indispensable after all
As the market opened up after the collapse of the Soviet Union, EU businesses made substantial investments in Russia. These investments were not limited to financial resources; EU companies were involved in building factories, establishing offices and localising the production of high-quality goods.

Any discussion on economic cooperation between the EU and Russia starts with highlighting the impressive trade turnover figures. In 2022 this turned into a liability for both sides. In 2013, the EU accounted for 57% of Russian exports5 (dropping to 30% in 2022)6  and over 46% of the country’s imports (38% in 2022).7 Conversely, in 2013, Russia represented more than 6% of EU exports (diminishing to 1.4% by mid-20238 and over 12% of imports (approximately 1.7% by mid-2023). This made Russia the EU’s third-largest trading partner (fifth in 2022), following the United States and China.6

The Russian leadership accepted a further deterioration of relations with the EU as a trade-off

Given the unprecedented level of sanctions imposed on Russia,9 the notable levels of remaining trade are surprising. Verifying trade data has become increasingly complicated as Russia suspended publication of foreign trade statistics in April 2022.10 Additionally, some of the sanctions’ effects will only become visible with time, and further economic restrictions are still in the works.

Critics have characterised these economic relations as excessive European dependence on Russia’s natural resources (constituting 30% of the EU’s energy imports in 2021, down to 8% by early 2023).11

Others have rather viewed it as interdependence, since the energy revenues were also crucial for the Russian budget. The huge trade volumes have been considered an important ‘safety net’ preventing both sides from taking actions that could be harmful to lucrative enterprises. As the famous German slogan ‘change through trade’ suggests: mutual trade gains should pave the way for better political understanding and internal reforms.

Yet, in reality, the Russian leadership accepted a further deterioration of relations with the EU as a trade-off, and the EU responded with radical sanctions, despite irritating many in EU business circles. Significant amounts of Russia’s state and private capital have been frozen in the EU with an expressed desire to use at least a part of it to pay for reconstruction of Ukraine.12

Russia, in turn, is taking steps towards the nationalisation of certain Western companies.13 Some EU companies are still operating on the Russian territory, facing reputational risks.14 The losses experienced by EU businesses in Russia are currently accepted as inevitable but may lead to numerous court proceedings and demands for restitution in the long run.

Security: At odds
Moscow rarely recognises the European Union as a security actor. Yet, security concerns are an important impediment to any potential improvements in EU-Russia relations.

Russian legislation claims unequivocal Russian sovereignty over lands and waters that the EU, as well as most of the world, considers temporarily occupied parts of Ukraine. Even a theoretical model of a compromise on this issue is hard to develop, unless one suggests a complete revision of policies by at least one of the parties involved. Without a solution, this issue is likely to lead to persisting hostilities.

The West and most of Russia’s immediate neighbours expect the war to become Russia’s defeat, and a lesson to any future Russian leadership not to take this road ever again

As Finland joined NATO, Sweden strives to do the same, and the remaining ‘militarily neutral’ European states reevaluate their security policies, the transatlantic link has become more critical to EU member states’ understanding of defence than ever since the end of the Cold War.

Many EU nations view the United States as their primary global partner and welcome its military presence on their soil. Both sides of the Atlantic Ocean perceive Russia as a major security challenge or an outright threat.

Russia holds a starkly contrasting perspective. Russia’s suspicion towards NATO is not new, but with its military operation in Ukraine, this distrust has taken on a whole new dimension. Moscow has now officially labelled countries within the broader political West as “unfriendly”.15 Based on presidential decrees, diplomats, journalists and businesses from these so-called unfriendly states face specifically designed restrictions that can be easily further expanded.

Furthermore, Russia’s 2023 Foreign Policy Concept, which presents the country’s official view on the world, accuses the US “and their satellites” of waging a new form of hybrid war against Russia.16

As the EU and Russia pursue diametrically opposed security models, future relations seem at odds. Current Russia sees a tacit acceptance of its recent (and possibly progressing) territorial ‘acquisitions’ as the minimum requirement for any future common security architecture. This is out of the question for the West and most of Russia’s immediate neighbours, which expect the war to become Russia’s defeat, and a lesson to any future Russian leadership not to take this road ever again.

Politics: Normative incompatibility
Russia’s and the EU’s attitudes towards each other – as well as towards most things – have deteriorated to new lows, not seen since before Perestroika years in the late 1980s. Distinctions are deliberately emphasised, inflated and instrumentalised by the Russian leadership to paint a picture of the EU as an unfriendly and troubled entity crumbling under the pressure of current and future challenges.

Back in 1990, the Charter of Paris17 and the subsequent progression in post-Cold War European relations showed a general readiness of all parties to acknowledge shared principles such as democracy, human rights, economic liberties, social justice and equal security.18 The last elements of this consensual vision have evaporated with the war in Ukraine.

As a member of the Council of Europe (CoE), Russia held the highest number of pending cases among the 47 CoE nations at the European Court of Human Rights.19 After leaving the Council of Europe in March 2022, the country no longer considers itself bound by the CoE-derived obligations that were once meant to constitute a more harmonious international legal framework.

In turn, the EU strongly advocates for an international justice mechanism capable of addressing cases involving the Russian government and its citizens.20

Russia still manages to successfully navigate and influence EU affairs by utilising politically instrumentalised anger within some parts of the EU’s population towards Brussels

Moscow’s ties with Brussels are practically destroyed.21 The firm conclusion in the Kremlin is that the European Union as a whole cannot be a partner, which mirrors the EU’s view of the current Russia. Instead, Moscow increasingly looks for allies among disgruntled national governments and political forces within the Union.

The EU is aware of this, and the tracking of Russia-related ties has become an everyday job for the media, governments and a number of NGOs. Yet, Russia still manages to successfully navigate and influence EU affairs by utilising politically instrumentalised anger within some parts of the EU’s population towards Brussels.The values gap is a deliberate political construct, but also a potential self-fulfilling prophecy: the longer people live under conditions that imply very different approaches to human rights and democracy, the easier it is to accept this as a norm. Similarly, the Soviet ideology and political practice were also hardly reconcilable with the rest of Europe, but history did not end there.

Society: In the crossfire
The level of support among ordinary Russians for the Russian government remains a matter of ongoing speculation. The disputed but widespread assumption among many opponents of the Russian leadership is that the toll of the war will drive Russians to demand change.

Russia adopts a similar stance, claiming that Western elites do not truly represent the core interest of their populations, especially within the EU, which is depriving itself of the benefit of cheaper energy from Russia.

Groups that have suffered the most due to the deteriorating EU-Russia relationship – internationalised businesses, students, and middle-class frequent travellers – do not constitute a critical mass capable of influencing governments. Russian authorities increasingly see these segments of society as potential conduits of Western influence, rather than as agents of modernisation and progress.

In the West, any appeal to engage in business ventures or explore compartmentalised solutions with Russia, unless Ukraine’s victory is secured, will be rejected as a sign of weakness and support for unacceptable policies.

Since the end of the Cold War Russians have had greater opportunities to become part of the global community, with Europe often serving as the natural gateway. While economic hardships of 1990s prevented the spread of these opportunities at first, the country had every chance to succeed as a cooperative player in the world. Then Putin U-turned.

With the war in Ukraine, the entry point to the West narrows. Future generations of Russians may still perceive a world more open than in the times of the Soviet Union due to remaining connections beyond the Western world and the positive impact of the market economy.

Yet, any ties to the West will be clearly unhelpful for a career in Russia, and Russian connections in the West will be a liability for public servants, business and even academia, unless they align with the Russian opposition, which has largely been marginalised or suppressed within the country.

The ongoing conflict might solidify mutual incompatibility, suspicion and animosity, potentially making these issues more permanent than during the Cold War

Russians who have settled in the EU, be it before or after February 2022, willingly or unwillingly remain the human connection between the decoupling actors. Due to the persistence of social media platforms – suppressed but unvanquished by Moscow’s censorship – some critical voices beyond Russia’s borders are evolving into true opinion-makers for Russian-speaking audiences in and outside the country.

The enlarged Russian diaspora is fluid and diverse, and efforts to understand it are just starting.22 While their direct impact may be limited, many of them hold aspirations to contribute to shaping a different future for Russia in the days to come.

Russia officially does not restrict entry for EU citizens, even making it technically more convenient for them, as the electronic visa is introduced.23 However, an increasing number of western public figures and experts are blacklisted, and the political conditions overall, along with the ban on direct flights, are not conducive for visits.

Motivated by security concerns, particularly pronounced among Russia’s immediate neighbours, the EU is making it harder for Russian citizens to obtain Schengen visas,24 with some some member states introducing further restrictions.25 However, the longer the war drags on, the question of how to establish a rational and balanced approach to people-to-people communication and the Russian diaspora becomes more prominent.

The bets are placed
Both sides have doubled down on diverging paths. Throughout Vladimir Putin’s rule, Russia’s leadership consistently boasted about the country’s exceptionally high levels of ‘sovereignty’, portraying it as the capacity to resist any international pressure and develop its own capabilities with its own natural resources. From this perspective, any broken link with the West is interpreted as an opportunity for Russian business to fill the niches, earning praise from protectionist lobbyists.26

Simultaneously, the European Union is placing its bets on advanced technologies and renewable resources to address the challenges posed by the rapidly diminishing supplies from Russia.

Both parties used to maintain more flexible positions regarding their political and economic models. However, the war in Ukraine has forced them into a corner with limited alternatives, putting their true resilience to the test.

The ongoing conflict might solidify mutual incompatibility, suspicion and animosity, potentially making these issues more permanent than during the Cold War. Rebuilding EU-Russia relations requires a trusted and holistic solution for Ukraine first, which is not in the cards.

• 1Ivan Timofeev, ‘Russia-West: Rising Stakes’, Valdai Club, 30 June 2023.
• 2‘EU Braces for Tussle Over 12th Russian Sanctions Package’, Bloomberg, 18 September 2023.
• 3‘Finland joins Baltic neighbors in banning Russian-registered cars from entering their territory’, AP, 15 September 2023.
• 4‘Lavrov formally withdraws Russia from Barents cooperation’, The Barents Observer, 18 September 2023.
• 5UK Parliament, ‘The EU and Russia: before and beyond the crisis in Ukraine’, European Union Committee, 6th Report, 10 February 2015.
• 6 a b European Commission, ‘European Union, Trade in goods with Russia’, April 2023.
• 7A few percent of trade turnover loss were a consequence of Brexit, thus, a recalculation rather than real change. But under the current circumstances the UK is just as determined to sanction Russia as the EU and the US.
• 8Eurostat, ‘Russia’s share in EU trade falls below 2%’, 1 September 2023.
• 9Ashutosh Pandey, ‘Russia is the world's most sanctioned country’, DW, 15 March 2022.
• 10‘Russia suspends publication of import-export data to avoid "speculation"’, Reuters, 21 April 2022.
• 11Eurostat, ‘EU imports of energy products - latest developments’, June 2023.
• 12‘EU Blocks More Than €200 Billion in Russian Central Bank Assets’, Bloomberg, 25 May 2023.
• 13‘Russia moves to seize ‘naughty’ western companies’, Financial Times, 15 June 2023.
• 14Jessica Tasman-Jones, ‘Reputational risks were already heading up the agenda … then Russia invaded Ukraine’, Financial Times Services for Organisations.
• 15‘Russian government approves list of unfriendly countries and territories’, TASS, 7 March 2022.
• 16Ministry of Foreign Affairs of Russia, ‘The Concept of the Foreign Policy of the Russian Federation’, 31 March 2023.
• 17OSCE, ‘Charter of Paris for a New Europe’, 21 November 1990. The Charter is a seminal document produced by consensus of the participating states at the Conference for Security and Co-operation in Europe (CSCE), which solemnly stated that the “era of confrontation and division of Europe has ended” and laid grounds for the transformation of the CSCE into OSCE.
• 18While these principles were easier to declare than implement, they provided the OSCE participating states with some basic common vocabulary.
• 19‘Russia’s Share of European Human Rights Cases Hits 7-Year High’, The Moscow Times, 30 January 2020.
• 20Jennifer Rankin, ‘Ursula von der Leyen steps up calls for tribunal for Russia’s ‘crime of aggression’’, The Guardian, 16 May 2023.
• 21There are no more summits or substantial negotiations, and Russia does not bother to nominate a new ambassador to the EU after the departure of the veteran Vladimir Chizhov.
• 22See, for example: E. Kamalov, V. Kostenko, I. Sergeeva, M. Zavadskaya, ‘New Russian Migrants Against the War: Political Action in Russia and Abroad’, Friedrich Ebert Stiftung, Series ‘The Russian Crisis’, No.5, June 2023.
• 23‘Nationals of EU & Schengen Countries Now Eligible for Russia e-Visa’, Schengen Visa News, 3 August 2023.
• 24European Commission, ‘Statement by Commissioner Johansson on general visa issuance in relation to Russian applicants and controls of Russian citizens at the external borders’, 30 September 2022.
• 25‘Cars with Russian number plates to be banned from traffic in Latvia’, LSM, 2 November 2023.
• 26Ironically, much of this ‘sovereignisation’ is made possible through support from China.