Nord Stream 2 future settled in Washington

At the moment, Ukraine puts all its hopes on the visit of Ukrainian President Volodymyr Zelensky to Washington on 30 August. The Biden administration took its time to announce a date for the “promised” visit to the White House, in a period when Washington is empty. Despite this evident lack of enthusiasm, Ukrainians are still convinced that their president can extract from president Biden changes in the agreement he has reached with German chancellor Angela Merkel on 20 July, after a series of officials’ visits and video conferences that started in March. If Ukrainians continue to look for support against the agreement in Washington, they could only find it among Republicans and radical Democrats, hardly a way for Kiev to ensure good relations with Biden. The American president wants to overcome Trump’s legacy who poisoned relations with Germany, a country Biden sees as a key ally on the European continent, and who piled sanctions on every company involved in the pipeline. The German chancellor, who always backed the project for industrial motives, reinforces the role of her country in Central Europe as the guarantor of Ukraine’s energy development.

Merkel’s victory

If Ukrainian diplomacy is obviously on the losing side, Angela Merkel is the big winner. Her lately damaged consensual image helped her to propose convincingly a soft landing for the most controversial energy projects in European history. In return for Washington waiving further sanctions, Germany undertook a series of political and economic measures to mitigate consequences of Nord Stream2 exploitation on Ukraine and to prevent Russia to use its gas deliveries as a weapon against Kiev. Washington and Berlin will better coordinate their policy on Russia and Ukraine. Kiev will receive substantial aide to modernise and convert its energy sector. Among other things, Germany will contribute 150 million euros to a “green fund” of up to 1 billion euros to that effect. The agreement includes a framework of vaguely formulated actions to target Russia in case of “aggression” towards Ukraine.

Merkel made clear that there is no German quid pro quo in a different area. She knew she was not only defending the interests of German industries, but also those of other EU members conscious that Russia’s gas deliveries are needed for the continent energy security, notably to ensure the gap of electricity production after the closure of nuclear and coal power plants. German industries will also benefit of their participation in the “greening” of the Ukrainian energy sector, and political circles be satisfied by promises that Germany will pressure Russia to renew its transit gas contract with Ukraine in the actual profitable terms. Merkel managed also to lift the pressure on her successor and the future coalition, freed of this politically sensitive question.

The losers

Reading through recent weeks’ official declarations in Western capitals, it seems that the best president Zelensky can get from his long-expected meeting with president Biden is a face-saving formula. It will test his capacity to make the best of an honorable defeat and remember him that, in a global market, economics realities win over political utopias. Biden is certainly prepared to announce some tortuous procedures to appease Zelensky, but he cannot, and does not want, to alter fundamentally the agreement which, among other goals, reasserts support to Ukraine while keeping channels open with Russia. Witness the talks held, in Geneva, on 28 July, between senior American and Russian officials about arms control and efforts to prevent a new global weapons race, in line with the “bilateral strategic stability dialogue” agreed between presidents Biden and Putin during their meeting in the same city.

If the agreement represents a setback for Volodymyr Zelensky, it left EU quite bruised. The most disputed energy project concerning its energy security has been settled in Washington, between the American president and the German chancellor. They, not Brussels, are the self-declared guarantors of the protection of Ukrainian interests, and not only in energy field.

The geopolitical Commission will be out until September, with a limited staff in Brussels. It will have to face Ukrainian frustrations, that includes the obligation to swallow the nomination of a German special envoy to deal with the “greening” projects, which can be seen in Kiev as putting its energy sector under supervision, with promises of investments far inferior to what it really needs.

The Ukrainian government already announced it will take the EU on its words, still hoping to prevent the exploitation of Nord Stream 2, even by agitating against an agreement reached between the US and a EU member state. It announced plans to use some provisions of Ukraine 2,135-page Association Agreement with the EU. Kiev wants the EU “to adhere to its own rules and hold its member states to the same standards it demands from aspiring member countries”.

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