Russian invasion and COVID-19 – new impulses for development of the Three Seas Initiative
The war in Ukraine and the pandemic fundamentally changed the geopolitical situation in the Central Europe, and thus also the awareness of the Three Seas Initiative states. The instability generated by Covid-19 shook the region’s faith in globalisation and lead to a conviction that the economic security can only be safeguarded by diversifying supply chains. The Russian invasion revealed to the Central European states real threats associated with being the eastern flank of the West. Quite unexpectedly, already on 24 February, the majority of state governments in this region clearly declared their allegiance with supporters of Ukraine’s victory, and not with the camp of “not humiliating Russia”, providing an extensive financial, military and humanitarian aid to Kiev. Will this new awareness of the Russian threat and unreliability of globalisation, common for the majority of the states in the region, start processes of empowering and closer integration of the region? Can this be supported by the Three Seas Initiative?
Infrastructural integration as a precondition for development and security
From the very beginning, the Three Seas Initiative aimed at breaking through the impotence affecting development of the infrastructure integrating the region along the north-south axis. This objective, which has not been implemented to this day, guided numerous integration projects in Central Europe – and was even included in the Visegrád Declaration of 1991.
It is the development of the regional infrastructure that seems to be a precondition for turning Central Europe into one of the EU economic centres and breaking with a role of an assembling facility for products designed in Western Europe. Ideas, people and goods require means for a fast transfer within the region, to create a space for development of innovative solutions and retaining the greater added value within the region.
Although during the last six years, the Three Seas Initiative managed to stimulate in Central Europe a discussion about a need to develop the infrastructure to improve the efficiency of regional transport routes and the energy security, yet many governments lacked the determination to put those assumptions into practice. The established Three Seas Fund managed to initiate a process for identifying the infrastructural needs of the region, but its effectiveness is diminished by the fact that three out of 12 Three Seas member states, i.e., the Czech Republic, Slovakia and Austria, still have not paid their contribution to it (while the United States, which are not a member of the Three Seas Initiative, declared their willingness to support the Fund).
Earlier, an opinion had predominated for a long time that it was not necessary to develop the infrastructure along the north-south axis, and that the existing transport routes connecting the states in the region with the western industrial centres were sufficient. Similar opinions were common also in the energy sector – some states (e.g., Austria) secretly supported the fast construction of Nord Stream 2, to import the cheap Russian gas. However, not all states demonstrated such great faith in Gazprom’s reliability. For example, Poland and Lithuania implemented their diversification plans with great determination.
What is surprising, the issue of the Russian expansionism was completely disregarded in discussions on the Three Seas forum, despite the fact that the majority of the Initiative members are a part of the NATO eastern flank. However, relations with Kremlin were an issue that divided rather than united the region. Many of the Central European states were interested in maintaining pragmatic relations with Russia, which they had not perceived as a real threat to their security.
Furthermore, many states understood including of these issues in a discussion about the regional cooperation as turning the Three Seas Initiative actually into a copy of the Intermarium plan, that is, a concept of a geopolitical alliance implemented under the cover of tightening economic relations. Although the awareness of a need for radical redefining of its relations with Russia had not yet matured in Central Europe, yet in certain states the symptoms of a change in their attitude towards Kremlin had already been visible before the invasion of Ukraine. An example of an initiation of such process can be a decision of local authorities in Prague to remove the statue of Ivan Konev, Marshal of the Soviet Union, in 2019, or mass expulsion of Russian diplomats from the Czech Republic and Slovakia a year ago, in a reaction to disclosed information about participation of the Russian military intelligence in blowing up of two ammunition depots in Czech Vrbětice.
The pandemic – a real test for the Three Seas concept
COVID-19 clearly demonstrated that principles underlying implementation of the Three Seas assumptions for the necessary stronger infrastructural integration of the region are right. The first signs that the previous globalisation model had lost its momentum already appeared in a period of increasing tensions between Washington and Beijing during Donald Trump’s presidency, when the Americans tried to break with a dogma of one, continuously liberalising global system by removing China from it.
The pandemic additionally revealed the fragile character of the previous globalisation model – production to an order (‘just in time’) – leading to development of supply chains that were as tight as possible and unable to react with greater flexibility in times of demand or supply shocks. Central Europe, as an important centre of the automotive sector that is internationalised to the highest degree, felt consequences of that situation. Many factories in the region were forced to suspend their production, while construction of certain new plants was put on hold.
COVID-19 desynchronised production cycles between Europe, Asia and America, as successive waves of the disease hit individual regions at different times, and with a varying intensity depending on health policies assumed. That resulted in enormous jams in supply chains. In some cases, when the delayed demand in states consuming a given good tried to return to normal, there was lockdown in a manufacturer’s country right at that time, and vice versa.
Furthermore, it turned out that too close concentration of the production potential for certain components, like semiconductors, in a specific geographic region had its rigid limitations and could not be rapidly increased in a period of renewed growth in orders.
Another manifestation of those problems were blockages in ports, which particularly affected landlocked member states of the Three Seas Initiatives, like the Czech Republic, Slovakia or Hungary. Many Czech or Slovakian entrepreneurs struggled with difficulties with supplies of components due to jams in German and Dutch ports used by them. This was further aggravated by problems with sudden changes in health policies, especially concerning testing of people crossing borders, frequently leading to queues forming on borders between EU states.
The COVID-19 pandemic clearly demonstrated how limited options for diversification of supply routes – for example, due to lack of regular logistic connections between the landlocked Three Seas states with ports in Poland or Slovenia – diminish resistance of supply chains and options for more flexible reaction to problems in the global logistics.
New awareness, but limited possibilities.
The reaction of Central Europe to the Russian invasion started on 24 February represents an important turning point, making governing elites aware of hazards associated with playing a role of the east flank of the West. Hardly anybody could foresee such consistent position of the region (excluding Hungary and Austria), which was ready to be in the avant-garde of the West policy towards Russia.
It was the countries of our region which from the very beginning assumed a role of suppliers and hubs for material, military and humanitarian aid for Ukraine, received Ukrainian refugees on the mass scale, and exerted the strongest pressure on implementing the first packages of the EU sanctions against Russia. They regularly pushed further the limits of the EU mainstream imagination, being a pioneer in implementation of sanctions at a national level (e.g., Poland and Bulgaria were the first to close their air space to Russian aircrafts) or supply of heavy weapons. The visit of prime ministers of the Czech Republic, Poland and Slovenia in Kiev at the times when Russian forces were still stationed near it is a symbol of that determination.
However, the months after the invasion also showed limits for options to support Ukraine, partly resulting from mistaken assumptions and negligence of recent years. The Czech Republic, Slovakia and Hungary were important countries hindering implementation of a uniform embargo on supplies of Russian oil. All three countries negotiated temporary derogations in this area of the EU sanctions. The situation with limiting dependence on natural gas supplies from the aggressor state looks even worse – many countries have problems with filling their gas storage facilities and anxiously await the approaching winter. Furthermore, due to underfinancing of own defence needs, a significant number of countries in the region slowly lose their ability to offer further military support to Ukraine.
Additionally, in certain states of the Three Seas Initiative, like Slovakia or Bulgaria, fragility of governing alliances may trigger early elections, in consequence of which political forces unwilling to support Ukraine may win.
A platform to oppose the economic pressure of Kremlin
On 24 February, Russia stepped upon a path of open confrontation not only with Ukraine, but also with the West. Even if Kremlin calculations concerning western countries’ readiness to support Kiev proved to be wrong in terms of the short-term assistance, Putin will definitely test their determination on a long run.
Kremlin will aim at breaking the West’s will through the economic pressure, potentially destabilising the political situation and prompting governments of individual states to limit their military, financial and political support for Ukraine.
If the export of Ukrainian and Russian corns to the global market is limited, a wave of famine can be expected in North Africa and Middle East, increasing for the EU a risk of the repeated migration crisis from the south, like in 2015. The efficient use of the gas blackmail may lead to a division in the West concerning relations with Russia.
The increase in prices of both food and energy sources will definitely be a factor contributing to the inflation, and thus, deepening the social inequalities. Many countries of the West already face significant social tensions in consequence of a number of economic downturns spread over last 15 years (like the global financial downturn, the Euro zone crisis, Brexit, or the pandemic) – e.g., in Spain the unemployment rate has been at a level above 10% since 2008. A prolonged high rate of price increases may be damaging for the fragile economy of the West, as well as bring back the long forgotten spectre of the Euro zone crisis, which has never been resolved structurally.
In the face of the Russia’s aggressive policy, the aim of the infrastructural integration of Central Europe becomes a necessity, not a choice. How much more resistant to the energy blackmail could that region have been, if it had maintained a decisive policy of becoming independent of supplies from Russia. How much less fund for arms would Kremlin have had then.
Opportunity for increasing the Three Seas Initiative importance
A need to diversify transport routes should also be an important lesson learnt from the pandemic, and this may be ensured only by establishing a network of connections along the north-south axis. On the one hand, after the invasion on Ukraine, there is a risk that the region will be perceived by investors as a flank one, that is, exposed to certain hazards, while on the other hand, after lockdown experiences many holdings aim at shortening their supply chains and producing goods closer to their target markets,
The stronger infrastructural integration of the region and associated intensification in the flow of people, goods, capital and idea offer an opportunity for establishing foundations for the improved innovativeness of the region, even when the foreign capital ceases to flow into it at such a large scale as it was the case in last decades.
The resistance of economies of the Central Europe states may be a crucial condition for maintaining their clear support for Ukraine, and thus, for building a group of states pressing on maintaining the West’s sanctions against Russia and supplying further aid to Ukraine.
The invasion also showed that certain assumptions of the Three Seas Initiative should be updated. The infrastructural integration of Ukraine with the EU should become its new objective. After all, the basic objective of the Three Seas Initiative was to establish a dense network of connections between countries located between the Black Sea, the Baltic Sea, and the Adriatic.
In the current situation, when Russia wants to suppress Ukrainian economy by blocking its ports on the Black Sea and thus to cut it off from the global trade, it is crucial to ensure development of infrastructural connections between Ukraine and Central European ports as fast as possible.
Assuming that for many years yet Kiev may not be offered an opportunity to join the EU, it is extremely important to offer to it an alternate path for developing its associations with the European Union. Connecting Ukraine with the most important European transport routes during its rebuilding, for example, by rebuilding railway tracks using the standard (European) track gauge, would be an impulse for development of this country. This would significantly facilitate the process of rebuilding, as well as reduce the Ukrainian economy susceptibility to blocking of the Black Sea ports.
The today’s world, which is significantly less safe, not only brings about great challenges to the Three Seas Initiative, but also offers even greater opportunities, of which the creators of this concept could only dream. Central Europe faces a momentous task of turning the region into a central point of Europe, not only in its geographic, but mainly in its political and economic dimensions. The way towards this objective leads through a stronger infrastructural integration of the region and development of connections with Ukraine.
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The opinions expressed in this publication are those of the authors and do not reflect the views of the official positions of the Ministry of Foreign Affairs of the Republic of Poland. Public task financed by the Ministry of Foreign Affairs of the Republic of Poland within the grant competition „Polish-Czech Forum 2022”.
dr Konrad Popławski