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New customs regime and Ukrainian factor: Main piece of resistance or weak link?

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Radu Vrabie / May 17, 2006
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The new-old customs regime introduced at the Moldovan-Ukrainian border on March 3 is being implemented for the third month, but the attitude of the main participating actors towards this measure has not substantially changed. Kiev continues to back Chisinau’s actions and both of them enjoy the firm support of the European Union (E.U.) and of the United States. On the other hand, Tiraspol does not show any weakness and refuses to comply with the new rules, while its stance is supported in continuation without any reserves, both politically and financially, by Moscow.

The maintenance of the current situation “of bed” for two months and half comes to contradict the forecasts of some commentators who estimated in early March that the situation would be settled in less than two months. Or, certain analysts said, the new Ukrainian government created after the March 26 elections will cede and (for how many times?) will make a step backwards; or others estimated that Tiraspol will be incapable to control the costs and will have to accept the new rules of the game, being suffocated by self-blockade.

Although both viewpoints were based on pertinent arguments, the developments in the past weeks have contradicted the forecasts, prefiguring a third scenario — transformation of confrontation into a war of attrition in which Chisinau, the E.U. and the U.S. on one hand and Tiraspol and Moscow on the other hand seem to be decided to go till the end. Kiev remains part of the first camp. Paradoxically, it is the main piece de resistance without which the entire construction would collapse, as well as the weakest link on the Chisinau-West-Ukraine axis.

How irreversible is this welcome stance of the Kiev Government and how resistant it will be in time and in front of imminent internal (Party of Regions and interests of shadow economy) and external pressures (Russia)? In what measure the recent optimistic assurances of Ambassador Jacobovits that President Yushchenko will remain 100 percent devoted to the new customs regime and will not withdraw it regardless of negotiations on configuration of the new government will be confirmed? What are the main factors of risk and what could Moldova do to combat and to increase the chances to maintain Ukraine on its current positions? These are some of questions that we will try to answer below.

We will notice from the very beginning that Ukraine “plays” on the same side with Chisinau, Brussels and Washington against Russia and Tiraspol regarding the customs problem, and this is a historical premiere. The maintenance of Kiev on this line is as praiseworthy as the experience of the past several years could get us used to the ambiguity and inconsistence of our eastern neighbour regarding the border. Kiev has immediately retracted any decision in favour of Moldova on customs and border matters at least four times since 2001, making one or even more steps backwards. As for example:

  1. After Presidents Kuchma and Voronin agreed in July 2001 like “gentlemen” to create joint customs stations in the Transnistrian section and to support Kiev to withdraw the old customs stamps, it looked like “raining” in Ukraine in September 2001: Moldovan customs officers were denied access to the Ukrainian checkpoints while the introduction of new customs stamps were effectively sabotaged. (Even more, Kiev closed the 5 joint customs stations in the north and the south in the non-Transnistrian section, which have functioned well since 1997). Ukrainian officials of all levels have insisted with obstinacy for more than two years that “nothing in international and national legislation obliges them to block the introduction of Transnistrian goods in the Ukrainian territory without new stamps.”

  2. In May 2003, being incapable to resist to criticism and pressures of the E.U. and U.S., facing the perspective to discredit its international image, Ukraine finally revised its stance and committed itself formally to recognise the Moldovan customs stamps only. This commitment was confirmed by a protocol signed by customs services of the two countries on 15 May 2003. Hundreds of trainloads and trucks from the eastern districts have continued to enter openly the Ukrainian territory every month without any Moldovan stamps for years, with Ukraine defying its own commitment to admit only goods with the new customs documentation and despite the facilitated registration regime for Transnistrian enterprises, which Moldova introduced through the June 12, 2003 Government Decision # 712, at the demand of Kiev.

  3. New democratic forces have reached the power in Ukraine after the orange revolution, Prime Minister Yulia Timoshenko has launched the national programme No to Smuggling, new Foreign Minister Boris Tarasyuk has delivered categorical statements regarding the need to eliminate the black hole in Transnistria, the head of the intelligence services in Kiev, Alexander Turchinov, has revealed the size of smuggling through Transnistria, and all these facts seemed to confirm the commitment of President Victor Yushchenko to “make order” in the Transnistrian section of the border and to contribute to the success of its plan of settlement through democratisation this way. On 26 May 2005, Premier Timoshenko signed the Government Decision # 400 and two orders # 164-p and # 165-p stipulating that with 45 days after their publishing the access of goods from Moldova to Ukraine will be based in continuation of the Protocol from 15 May 2003, that means on basis of the Moldovan customs documentation only. However, the governmental decision concerned was enforced neither after 45 days, nor after half a year.

  4. However, on 30 December 2005, a month after the E.U. Border Assistance Mission to Moldova and Ukraine has started its work, the prime ministers of the two countries, Vasile Tarlev and Yuri Yekhanurov, signed a declaration saying that starting 25 January 2006, (1) Moldova will resume the mechanism of simplified registration of Transnistrian economic agents; (2) Ukraine will enforce the 15 May 2003 Protocol. However, Kiev has delayed again the enforcement of the Declaration, while on 27 January 2006 Secretary of the Ukrainian Security and Defence Council Anatoli Kinakh said that “the old customs rules remain in effect at the Moldovan-Ukrainian border.” The intensified criticism from the E.U. and the U.S., when it was clearer that the West may publicly accuse the Kiev governance of tacit support for smuggling right before the parliamentary elections, led to the implementation of provisions of the March 3 Declaration of the two premiers. U.S. Ambassador to the OSCE Julie Finley and E.U. Representative to Moldova Adrian Jacobovits have criticised first the passivity of Ukraine regarding the strengthening of border control, saying that this attitude trenches on complicity with Transnistrian separatists. The heavier artillery has got involved with similar statements: E.U. High Representative for Foreign Policy and Common Security Javier Solana and U.S. Deputy Secretary of State David Kramer. Brussels has hinted that the E.U. Troika, which was expected to visit Kiev on March 3 was due to take a categorical attitude on March 3, while the American side has notified through diplomatic channels that it will tackle this issue with Minister Tarasyuk during his visit to the U.S. on March 9–10. Or, the perspective of the intensified criticism from those whose opinion has been supported so much by orange electorate could not raise the concern of the Yushchenko-Yekhanurov Governance, being aware that this situation will be speculated immediately by main rival Yulia Timoshenko. Thus, the paradox may be explained — a decision of the Kiev Government to enforce the 15 May 2003 Tarlev-Yekhanurov Protocol with three weeks before elections.

As the decisions adopted under pressure of circumstances of conjuncture have the tendency to be reviewed after the change of external factors that caused them, so the attachment of Kiev for the new customs regime implemented at the border was susceptible not to resist much time after the March 26 scrutiny. Surveys have also offered reasons to anticipate such an evolution (or involution) in early March, as they indicated a governance alliance between Yushchenko and the Party of Regions of Viktor Yekhanurov, which is very critical over the new customs regime. Meantime, economic arguments have been released — millions of dollars that Ukrainian economic agents lose because the commodity flows from and to the Transnistrian region was suspended. Neither Moldova, nor the West compensates these costs.

Unquestionably, Kiev’s decision to join Chisinau, Brussels, Washington has harmed the Ukrainian interests in Transnistria on short term. And not only the economic ones. From political viewpoint, the anti-Ukraine hysteria started by Transnistrian propaganda and Russian mass media undermined Kiev’s influence on situation and processes in the region. Tiraspol and Moscow has skilfully used the information blockade of the regime of Igor Smirnov on population to create an image of enemy of the Transnistrian people to Ukraine, which “has sold itself to its American sponsors” interested to suffocate the “rebellious region”. Being obviously concerned with losing its influence and spoiling its image in Transnistria, Kiev asked Chisinau through diplomatic channels in the mid-March to intensify its efforts aimed at a better explanation of the essence of the new customs region to population and economic agents from the left bank of the Dniester river. Meantime, Kiev has prepared the ground for a possible “flexibility” of the process of registration of Transnistrian commodities. In this regard, it was proposed to award the right to the Ukrainian Customs Service to apply the Moldovan customs stamps. Although Ukraine has assured that this derogation from the December 30 Declaration will be temporary and the Moldovan customs stamps will be applied in the presence of European observers, Moldova has immediately turned down this proposal while the U.S. and the E.U. did not back it.

Ukraine did not table such ideas anymore, while the Ukrainian Foreign Ministry and the head of the Kiev diplomacy have reiterated more than once Kiev’s support for an appropriate implementation of the December 30 Declaration. Even more, Kiev has categorically refused to discuss the new customs procedures at a round of consultations of mediators in Moscow on 19 April, insisting that this issue rests exclusively with its bilateral relations with Moldova. The Russian negotiator has tried at that meeting, which representatives of Chisinau and Tiraspol did not attend, to propose the resumption of the negotiation process in exchange for the comeback to the situation before March 3 regarding the customs regime. Ukraine’s support for the stance of the OSCE, the E.U. and the U.S. at that round has made some observers say that the format of that meeting was “4+1”. In this context, the appreciation of Olvia-Press that the format is “2+5”, in which five opponents (the U.S., the E.U., the OSCE, Ukraine and Moldova) play against two (Transnistria and Russia) seems to be justified as regards the new customs rules.

Truly, the standpoint of Ukraine[1] mostly coincides with the stance of the OSCE, the U.S., the E.U. and Moldova. Thus, Ukraine regards the implementation of the Joint Declaration as an important step forward an efficient control on the Moldovan-Ukrainian border and its securing, rejects the accusations of economic blockade, saying that this is a self-blockade imposed by Tiraspol in a move to destabilise the political and economic situation in the region artificially and to obstruct the positive evolution of the Transnistrian settlement process, condemns the actions of the Transnistrian region aimed to obstruct the registration of Transnistrian economic agents with the competent bodies in Chisinau, denies the existence of any premises for talks about the “humanitarian crisis”, etc.

However, how long Kiev will maintain these positions? The head of the Tiraspol foreign department, Valerii Litskai, has said more than once that the March 3 decision of the Ukrainian government is intermediary and a more serious stance may be discussed only after the creation of a new cabinet. On March 15, Litskai said that “the scenarios will be outlined after 20 May” [it means the next days and weeks]. It seems that this is the stake of Tiraspol — the wait for a Ukrainian government of coalition with the Party of Regions, which could annul the new customs regime. According to Litskai, “the joint declaration was signed by the Kiev government head; when he will be changed, his successor will have a whole mandate and all the reasons not to be influenced by commitment of his predecessor.”

However, if the optimistic scenario of Ukraine is materialised and the Joint Declaration is implemented in continuation after a new Government is created, this will not guarantee that Tiraspol will give up its standpoint soon.

A lot of things (but not all) depend on Moscow’s stance, because it is strongly “playing” in this case. The Russian Foreign Ministry criticised vehemently on 4 and 17 March 2006 the decision of Ukraine to enforce the Yekhanurov-Tarlev Declaration and asked it to give up and to restore the status quo ante (the theses of these documents have been reiterated more than once by Russian officials and diplomats). Russia was aiming among others to discredit the Yushchenko-Yekhanurov tandem before elections, as well as to strengthen its levers of economic and political control on Transnistria, in the detriment of Ukraine and Moldova.

The Kremlin has used the alleged “humanitarian catastrophe” (with chock-full markets of Transnistrian cities and villages with different food products) to “shoot two rabbits” at once. Firstly, to demonstrate to the national public opinion that it is capable to take decisive actions by organising a campaign of collection of humanitarian aid to “brothers in danger” and punishing Moldova by hardening the economic sanctions. Secondly, to prepare the ground to take over the control on few valuable economic objectives that it did not seized yet, offering credit lines for actions of important enterprises, which manage to pay salaries, but they will reimburse the “credits” in kind and for a much lower price than the real value of these companies, as the process of trading of goods is stopped.

On the other hand, Moscow’s stance allows Igor Smirnov to play his internal game and to start preparing for the December-scheduled “presidential” elections in the region. The Tiraspol leader radicalises the population of the region by artificially worsening the tension and challenging the psychosis of a “besieged fortress”, marginalising the more temperate forces. Or, this radical stance of Igor Smirnov is the only one capable to maintain him in the administration of the region. In this case, the Transnistrian leader relies on radical and chauvinistic forces from Moscow, which use the hysteria of mass media to press the Kremlin to adopt a harsher stance over Moldova. And this would be one more argument for the acting Tiraspol administration, as Moldova’s image of “enemy” has strengthened after March 3, because the worse the Moldovan-Russian relations will be, the more the positions of Smirnov in the region will be consolidated. “The leaders are not changed in times of tribulation,” this is the slogan of actions of Transnistrian propaganda makers.

This game may be successful in one case only: if Tiraspol and Moscow are able to hold the information monopoly in the region in continuation by laundering the brains of population with all kinds of untrue stories. One of them, which has come in handy very well, is that Moldova aims to seize the Transnistrian economic potential and to cover the holes in the own budget by taxing them. Another story tells the “huge difficulties”[2] faced by economic agents based in the region while willing to get registered. The fact that a large part of the Transnistrian region believes these lies until now when a) the registration is a formality of 30 minutes and b) Transnistrian exporters must not pay any leu to the budget except for the symbolic price of 0.18% for customs procedures reveals the failure of Chisinau to “break” the information blockade in Transnistria.

The intensification and optimisation of efforts aimed to combat the propaganda of the regime of Igor Smirnov by creating some mechanisms to tell its stance to population from the eastern districts and to inform it about the real state of things on the left bank could be one of the most important directions on which Chisinau should focus its efforts.

As Tiraspol and Moscow do not show any signals that they are ready to cede at least something regarding the customs regime, the encouraging of democratisation on the left bank and allowing the residents of the region to inform themselves from alternative sources would complicate the stances of the Smirnov regime. If the distribution of forces in the new customs regime problem is now 2 (Russia, Tiraspol) and 5 (Moldova, Ukraine, the OSCE, the E.U. and the U.S), an effective democratisation of Transnistria would bring another important ally to us — the population of the region — turning the format into “2+6”.

Regarded from Chisinau, Kiev, Brussels and Washington, the benefits of the new customs regime and the entry of Transnistrian economic agents in the legal and regularised trade, which would provide them access to new markets under preferential conditions, seem to be absolutely evident. It is also obvious that the Tiraspol administration, rather than Moldova and Ukraine, has imposed the blockade on the region and led to the stop of functioning of tens of enterprises. However, these truths are not evident for common population of the region yet. Many people cannot get rid of some cliches of the Transnistrian and Russian propaganda behind the information wall built by Tiraspol.

However, the situation could change dramatically in our favour, if Moldova assisted by its friends breaks this information blockade and ensures the right of the region residents to right information. However, if some of dangerous trends revealed in the past 2.5 months are not inverted, the situation may develop dramatically against a normal customs regime and an approach to a lasting settlement of the Transnistrian conflict.

  1. Statement by the Mission of Ukraine to the OSCE at the Permanent Council of March 9, 2006, as delivered by Ambassador Volodymir Yelchenko, APE Transnistrian Digest, special edition #13,15.03.2006
  2. Стенограмма Пресс-конференции Посла Российской Федерации в Республике Молдова Николая Рябова. Кишинев, 20.03.2006; APE Transnistrian Digest, special edition #15, 30.03.2006.
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