As Eric Kraus has pointed out there is complete confusion in the
media today about how to spin the latest EU sanctions decision. Did
Syriza fold as per Reuters and Bloomberg. Or did the meeting expose
growing splits within the EU as per the Financial Times and the London
Times.
The best answer is that nothing definite
was decided at the latest EU Council meeting but Syriza did manage to
put a marker down.
I go back to my piece about Syriza for Russia Insider (http://russia-insider.com/en/
Given
that this is so, it is simply unrealistic to expect a very young
government in the very first days of its existence to provoke a crisis
within the European Union that pitches it against the Commission,
Germany, Britain and France, risking a deeper crisis in Greece and
putting in jeopardy its own existence, on an issue that for Greeks is of
only peripheral importance.
What Syriza did on Thursday was all that in the circumstances it could realistically do: apply a soft brake on the sanctions train.
The
European Council meeting was convened by Mogherini, the EU's "foreign
minister", following demands from the EU hardliners led by Donald Tusk
(who now nominally chairs the European Council when it meets at heads of
government level) who have been calling for a strong EU response to the
breakdown of the ceasefire and the ongoing NAF offensive, which has
resulted in the capture of Donetsk airport and the gradual encirclement
of the Debratselvo pocket. It also took place against a drumbeat of
orchestrated hysteria following the shelling in Mariupol. Prior to the
meeting Tusk said that he was not interested in a meeting that was
purely declamatory.
That however is what Tusk got. What came out of the meeting was essentially declamatory.
The
Greeks insisted on a belligerent paragraph directed against Russia
being removed from the text of the final EU statement and postponed any
further decision on further sanctions to a European Council meeting on 12th February 2015,
which will take place at heads of government level. In return they
agreed to an extension of the limited sanctions against specific Russian
companies and individuals that came into force in March, but not for a
full year (as the hardliners apparently wanted) but only for 6 months
(to September 2015).
These sanctions are a serious matter for the individuals concerned, but they are not critical for Russia.
This
is not the outcome that either the Russians or the EU hardliners led by
Tusk had wanted, but it gives time and space for Syriza to sort out its
own position and make whatever alliances within the EU it can, both on
the critical debt question and on the less critical question of
sanctions.
The next test will come at the European Council meeting on 12th February 2015
which Tsipras himself will attend. As of now it is looking unlikely
that the EU will impose further significant sanctions on Russia at that
meeting. Syriza is opposed to such sanctions but more importantly some
of the other EU states are not keen on them either. They now known that
one EU government - that of Greece - is strongly of that view, which is
likely to make their opposition still stronger. To what extent more
sanctions can be prevented at the meeting on 12th February 2015
will depend on the extent to which Syriza is able to play on the doubts
of these other EU states. Significantly Syriza did manage to play
successfully on these doubts at the meeting on Thursday, when it received the discrete support of several other EU states.
The
big test however will be when the sectoral sanctions come up for
renewal in July. That is the key decision upon which the future of the
sanctions ultimately depends.
I would add that by July - and even more by September when the sanctions that were extended on Thursday come up for renewal - we will also have a better idea of the prospects for a Podemos victory in Spain.
If
Podemos does win in Spain, then the entire calculus changes with Syriza
having one of the big EU countries as an ally. I hardly need say that
Spain carries immeasurably more weight within the EU than does Greece. A
Podemos government in Spain can afford to go it alone on sanctions and
defy the other big powers in the EU. A Syriza government cannot.
In
my opinion Thursday's decision was the best that could be expected in
the circumstances. As I said the big decisions are still to come. It
would be of no benefit to Russia, Greece or Syriza if Syriza had
provoked a crisis in the EU on Thursday
on a question of extending the least important sanctions, which caused a
dramatic escalation of the economic crisis in Greece, which in turn
meant that Syriza was either swept from power in Greece or was unable to
make independent decisions when the big decisions come up in July.
I would finish by again repeating what I said before in my Russia Insider piece and here.
Greece
is a small and economically very weak country. For its people the
sanctions are not the priority. The economic crisis is. That is why
they voted for Syriza: to solve the economic crisis, not to get the
sanctions on Russia lifted. On the sanctions issue people should not
expect more from Syriza than it promised or can realistically deliver.