Publication: Prism Volume: 1 Issue: 14

Ukrainian and Russian negotiations on the Black Sea fleet fail to make progress

by Vladimir Socor

On July 25 and 26, Russian and Ukrainian prime ministers ViktorChernomyrdin and Evhen Marchuk held talks in Moscow on securityand economic issues. The talks and their immediate context highlightedcontinuing and even widening differences on the Black Sea Fleetand other military-political problems, coupled with recognitionby both sides and particularly the Ukrainian that economic necessityimpels them to cooperate in that sphere in their mutual interest.

The issue of the Black Sea Fleet clearly dominated the meeting.The Ukrainian delegation came to Moscow with a response to proposalspresented a week earlier in Kyiv by Russian deputy foreign ministerSergey Krylov. Kyiv believes that the latest Russian suggestionsdepart from the Kuchma-Yeltsin Sochi agreement on the divisionand basing of the Black Sea Fleet. That agreement is being interpretedby Moscow as providing for exclusive Russian use of Sevastopoland other naval bases in Crimea, and by Kyiv as allowing for dualuse. The Ukrainian side is concerned to preclude unchecked Russianentrenchment in Sevastopol and other naval ports in Crimea, asboth civilian and military elements in the Russian governmentseek. On the eve of the Moscow talks, the commander in chief ofRussia´s naval forces, Admiral Feliks Gromov, publicly reaffirmedMoscow´s claim to exclusive basing in Sevastopol, Feodosia,and Kerch–which he said would adequately safeguard Russian securityinterests in the Black Sea region–while relegating Ukraine´sfleet to Donuzlav and Ochakov.

Ukraine´s counterproposals, as summed up by its representatives,avoided the issue of Russian basing rights, focusing instead onthe principles and terms of possible basing and on compensationto Ukraine for the Russian fleet´s use of land and infrastructure–"forwhich we have nothing in return," as Ukrainian foreign ministerHennadi Udovenko publicly pointed out. Kyiv adroitly moved togive the new Crimean leadership a stake in that compensation.In consultations in Simferopol on its way to Moscow, the Ukrainiandelegation agreed with Crimean leaders that the rental chargesto the Russian fleet should reflect the high commercial valueof Crimean land and that Crimea should share in the proceeds.Those should be substantial, for according to Crimea´s deputyprime minister Ondrii Senchenko, the Russian fleet´s shoreinstallations and facilities currently occupy 54,400 hectaresof land in Crimea.

Moreover, the Ukrainian side now moved near the top of the negotiatingagenda three hitherto dormant issues which are apt to substantiallyincrease Ukraine´s counterleverage. First, it demanded thewithdrawal from Ukrainian territory of Russia´s ground troopsstationed in Crimea, which are classified as a coastal defensedivision. Basing its demand on the 1990 OSCE treaty on limitingconventional forces in Europe, the Ukrainian side demanded a resolutionof the issue by November 15, 1995 "so as to place Russiain strict compliance with the treaty." Secondly, Kyiv reactivatedits claim to the unfinished aircraft carrier Varyag. Andthird, it raised the issue of compensation for the "billionsof dollars" worth of ecological damage inflicted on Crimeaby the Black Sea Fleet over the years.

The Ukrainian delegation proposed that the compensation be paidto Crimea by Russia and Ukraine proportionately to the Fleet sharesto be allocated to each (Ukraine´s would be less than a fifthunder Russia´s proposals). The Ukrainian delegation addedthat the proposal had been coordinated with the Crimean governmentwhich supported it. Announcing at a Moscow briefing that Ukraine"shall insist on this," Environmental Protection andNuclear Safety Minister Yurii Kostenko, who was included in theUkrainian delegation, added that "Russia in principle treatsthis problem with understanding. This understanding should, however,be accompanied by real volumes of financing. But the Russian sideregards this matter without any enthusiasm."

The negotiations´only result was the appointment of a jointcommission to resume discussions July 28 and prepare a new Chernomyrdin-Marchukmeeting for August 2. The commission´s mandate focuses ontwo documents dealing, respectively, with the division and thebasing of the Black Sea Fleet. But back in Kyiv, Marchuk declaredthat nine or ten documents would have to be prepared and signedfor properly dividing the Fleet, and that one of the "seriousissues" that had not even been tackled at the Moscow talkswas that of the terms of a Russian lease for use of Sevastopol.

The Black Sea Fleet is the main and the most chronic, but farfrom sole security issue in dispute between Moscow and Kyiv. Recentweeks have seen Russia and Ukraine moving incrementally to differentsides of several international issues. Following Ukraine´sinclusion in the recent London meeting of the Contact Group forex-Yugoslavia, Ukraine has distanced itself from most of Russia´spositions. This week, President Leonid Kuchma has called for increasingthe number of UNPROFOR troops in Bosnia, indicating that Ukrainewould have no objection to this being done with NATO troops. Kuchmacommented that Ukraine´s stance on that issue demonstratedthat the country had become a factor in its own right on the international scene. Last week, Foreign Minister Hennadi Udovenkoand other officials offered Ukraine´s services as both hostand mediator for talks among the Bosnian parties. Apparently alludingto Russian partisanship in the conflict, they pointed out thatUkraine has no interests of its own in the Balkans and would thereforeact impartially.

Also last week, joint Ukrainian-American military exercises arebeing held near Mikolayiv. Codenamed Marine Peacekeeping Mission’95 and financed by the US under NATO´s Partnership for Peaceprogram, the exercises include simulation of ship-borne Marinelandings ashore and of airborne attacks, joint participation inpeacekeeping operations, and common shooting practice. This isthe second series of joint US-Ukrainian exercises this year, afterthe exercises with ground troops near Lviv. And also last week,Kuchma conferred in Baku with President Heydar Aliev of Azerbaijan,another CIS country which has stayed out of the CIS collectivesecurity system and which, moreover, opposes Moscows´s effortsto control Caspian oil extraction and pipelines.

Ukraine´s willingness to pursue its own security and foreignpolicy interests goes hand in hand with its quest for mutuallyadvantageous economic cooperation with Russia. Assessing the Moscowmeeting, Marchuk described such cooperation as vital to Ukraine.The delegations signed a framework agreement on the principlesof setting up joint financial-industrial groups and of cooperationamong them. The agreement identifies fuel and energy, ferrousand nonferrous metallurgy, machine building, and space equipmentas priority sectors for such joint enterprises. According to officialson both sides, the agreements would provide Ukraine with stableenergy and raw material supplies and enable Russia to use existingprocessing capacities in Ukraine´s heavy industry insteadof building substitute ones in Russia. Ukrainian officials alsocommented on the importance of mutual deliveries of specializedtypes of machinery to each country´s industry. While theframework agreement amounts to a mere statement of intent at thisstage, the sides signed a first specific agreement on creatinga joint aluminum company based on a Russian and a Ukrainian plant.A separate agreement signed at the Moscow meeting covers jointuse of fuel pipelines on Ukrainian territory. According to initialreports, the agreement governs the transit of Russian exportsto other countries via Ukraine and transit fees accruing to Ukraine.

The Moscow meeting registered for the first time the fact thatUkrainian debt reimbursement to Russia, mainly for past deliveriesof fuels, was practically on schedule following the Western-assistedrescheduling of that debt in March 1995 for a 12-year period.The main contentious issue in bilateral economic relations atthe moment is that of Russian tax surcharges for fuel exportsto Ukraine. Moscow uses that practice to pressure Kyiv into joiningthe Russia-Belarus-Kazakhstan customs union, which would in Ukraine´sview be inconsistent with its independence. In public remarksfollowing the Moscow meeting, Chernomyrdin indicated that Moscowwould continue to condition the lifting of the export taxes onUkraine joining the customs union. Kyiv for its part hopes thatprogress of economic reforms in Russia would lead to the abolitionof such surcharges.

The negotiations illustrated both the reality and the limitsof Russian leverage over Ukraine. Indeed, that once-strong leverageappears to be steadily diminishing. The arrangements reached ondebts, pipeline use, and industrial cooperation highlight notonly the means of pressure at Moscow´s disposal but alsoKyiv´s intelligent use of its–albeit more limited–counterleverageas debtor, as country of transit for Russian fuel exports, andas a specialized producer of goods needed by Russian industry.Current political trends are also conspiring to limit Moscow´smeans of pressure upon Kyiv. The latter has succeeded at leasttemporarily in stabilizing the political situation in Crimea andhelping to power a friendly leadership there. Owing to the startof economic reforms among other factors, Ukraine´s internationalstanding has grown rapidly, as has recently the Western understandingof the country´s centrality to international security. Eventhe long-delayed visit by Boris Yeltsin to Ukraine and signingof an interstate treaty no longer work as a bargaining devicefor Moscow. That visit and the signing of the treaty were indeedimportant to Kyiv for domestic political considerations. But asUkrainian offcials point out, the approach of parliamentary andpresidential elections in Russia increasingly make that visitas politically valuable to Moscow as it has been to the Ukrainianleaders.

The steady decrease of its economic and political vulnerabilityto Moscow will allow Kyiv to defend with growing effectiveness its national security interests and define its own course ininternational affairs. While remaining carerful not to confrontRussia on bilateral or international security issues, Ukraineis increasingly likely to at last occupy its due role in regionaland European politics. The implications transcend by far the bilateralRussian-Ukrainian context. To take only the related issues ofthe Black Sea Fleet and Crimea, their resolution is being closelywatched in neighboring and riparian Romania, Moldova, Bulgaria,and Turkey. All have vital security interests at stake in theoutcome. They perceive Russia´s insistence in maintainingforces on the peninsula as motivated at least partly by an intentionto retain means of intimidation vis-a-vis the region´s countries.Significantly, Turkey has thus far been the only country to havevoiced these concerns out loud and to have come out in supportof Ukraine´s position. But the other countries also knowthat if it succeeds in defending its own security in the BlackSea, Ukraine will have served the security interests of the regionas a whole.
Vladimir Socor is a Senior Analyst for the Jamestown Foundation