Strategic Forecasting Forecast

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  • Russia's position in Eurasia will improve in the coming year as the United States transitions to a new administration and the European Union faces growing institutional challenges.
  • Countries in the former Soviet periphery will reassess their relationship with Moscow and the West accordingly.
  • Still, Moscow will not have free reign in Eurasia, and its standoff with the West will endure and evolve in 2017.


Russia may have something to look forward to in 2017. For the past three years, the country has suffered numerous strategic setbacks and faced significant pressure from the West. The 2014 Euromaidan uprising in Kiev ushered in a period of increased cooperation between Ukraine, the European Union and NATO. Other strategic countries along Russia's periphery, such as Moldova and Georgia, followed suit as U.S. and NATO forces expanded their presence and activities along the borderlands from Poland to the Baltics to Romania
At the same time, the United States and the European Union imposed and continuously extended sanctions against the country for its actions in Crimea and eastern Ukraine. This put added strain on Russia's economy, which plunged into recession after oil prices crashed in mid-2014. To finagle a seat at the negotiating table with the West — and the United States in particular — Russia got involved in the conflict in Syria. The strategy has so far failed to yield the grand bargain that Moscow was hoping for on contentious issues such as the conflict in Ukraine. But 2017 could herald a new phase for Russia's standoff with the West.

An Opportunity for Change

Over the past year, mounting tensions have exposed the cracks in the united Western front against Russia. The Brexit vote revealed deep rifts in the European Union, and Donald Trump's victory in the U.S. presidential election may portend a break in Washington's policy toward Moscow. Elections across Europe in 2017 — in France, the Netherlands, Germany and possibly Italy  — could further widen the divides in the Continental bloc and challenge the future of European integration.
For Russia, the West's looming struggles in the coming year present an opportunity. Moscow has worked to exploit and in some cases influence the dynamics in the European Union and United States to undermine Western unity through propaganda campaigns, cyberattacks and political maneuvering. Russia will likely intensify these efforts in 2017, making the most of the discord in the West to achieve its aims, such as an adjustment or end to the U.S. and EU sanctions regimes. The recent loyalist advances in Syria, meanwhile, could improve the Kremlin's position to negotiate with the Trump administration over a range of issues.

Regaining Ground

Closer to home, these changes will enable Russia to recoup some of its influence in the former Soviet periphery. Given the upheaval in the European Union, the bloc will be hesitant to move forward with proceedings to accede new members in 2017. As their prospects for integration with the European Union and NATO stall and perhaps fall apart in the coming year, countries such as Ukraine, Moldova and Georgia will re-evaluate their relationship with Russia. In fact, in its recent presidential vote Moldova elected Igor Dodon, a candidate who has pledged to increase ties to Moscow and review the country's EU integration efforts. Though Ukraine and Georgia are unlikely to follow suit, they may well take a more pragmatic approach to Russia, increasing trade ties to the country and compromising over the status of their breakaway territories.
Moscow will probably also gain influence in states such as Azerbaijan and Uzbekistan, which have maintained their neutrality toward Russia since the Soviet Union collapsed. Moscow recently signed agreements to expand its military cooperation with each country. Though the deals do not signify a strategic realignment for Baku or Tashkent, they will nevertheless increase Russia's sway in these countries. Moscow will also try to assume a more active role in ensuring Central Asia's security in the coming year as the historically stable region reckons with a variety of challenges.
Even former Soviet countries already aligned with Moscow — including Belarus, Armenia, Kazakhstan, Kyrgyzstan and Tajikistan — will probably redouble their cooperation with Russia in the coming year. Many of these countries have already signed agreements with Moscow to deepen integration in the security sphere. The growing strife in the European Union, moreover, will discourage countries such as Belarus and Armenia from trying to further increase their bilateral relations with the bloc. Consequently, the Eurasian Economic Union and Collective Security Treaty Organization — Russia's primary blocs — could become more active in 2017 after languishing over the past two years.

A Limited Resurgence

Despite the promise that the new year holds for Moscow, however, Russia's comeback is far from guaranteed. Because the United States and NATO are unlikely to withdraw from the European borderlands completely, Russia will not have free reign over Eurasia. Furthermore, various parties in the United States and European Union will contest the removal or easing of sanctions against Moscow. Facing the prospect of diminished support from the West, Ukraine and Georgia may look to build their own blocs with nearby countries such as Poland and Turkey for reinforcement against Moscow. Russia, meanwhile, will be cautious not to act too aggressively in its borderlands as it contends with lingering economic and political problems at home.
These factors will keep Russia from taking full advantage of the turmoil and uncertainty in the West as their standoff stretches into a new year. Nonetheless, the country could make significant headway in its negotiations with the West and in its former sphere of influence in 2017.
Lead Analyst: Eugene Chausovsky
Editor's Note: The Global Affairs column is curated by Stratfor's editorial board, a diverse group of thinkers whose expertise inspires rigorous and innovative thought. Their opinions are their own and serve to complement and even challenge our beliefs. We welcome that challenge, and we hope our readers do too.
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As outlined in a recent piece by Stratfor Editor-in-Chief David Judson, we're going to be expanding Global Affairs in the coming months, seeking to add diversity and texture to our cast of outside contributors. I would add that while most of our subject matter in this space is not contoured along the liberal-conservative spectrum, the worldviews of authors do matter and we will be seeking balance. Our definition of balance will not be to head straight down the middle between left and right (an aspiration to objectivity that many doubt possible), but instead to put our weight first on one foot, then the other, right, left, right, left — to walk toward balance and fairness, if you will.
So in this column I want to offer a set of impressions from my recent trip to Russia, and I warn you: What I've seen runs contrary to much of what you may have read in the press.
I'm no Russia expert. I neither speak nor read Russian. But ever since 1980 I've been part of a small group of people practicing what we call "citizen diplomacy." One of our members who worked at the U.S. State Department at the time coined the term "two track diplomacy." When the first track of high-level diplomacy gets stuck, as it often does, it takes bankers meeting bankers, teachers meeting teachers, psychologists meeting psychologists, to break through presumptions of hostility and projections onto the face of the Other. Ordinary citizens talking shop with their counterparts in the country of the presumptive enemy can then discover that we all put our pants on one leg at a time, and nuclear weapons are not the best medium of exchange.

Track Two: An Institute for Citizen Diplomacy

So we formed Track Two: An Institute for Citizen Diplomacy, and spawned initiatives such as a psychology library in Moscow, an art competition with shows in San Francisco and Vladivostok, and the International Society of Space Explorers, where Russian cosmonauts and American astronauts first met and began a fruitful collaboration that extends to this day.
Our tiny group also sponsored Boris Yeltsin's first visit to the United States, during which, in front of a shelf full of many brands of mustard in a Houston supermarket, he had an epiphany about how much 70 years of communism had denied his people. "All my life I've been lied to," he wept. Yeltsin returned to Russia, quit the Communist Party, stood on a tank during the August 1991 failed coup, and the rest, as they say, is history. Because of these events, six of us were invited to return to Russia to visit the Boris Yeltsin Presidential Center and Museum, a trip from which I returned just last week.

Early Visits to Russia

I first went to Russia in 1983, well before the end of the Cold War. I went back in 1986, again in 1991 just a week before the failed coup, and a fourth time in 2005 when, on behalf of the U.S. government, I conducted 28 high-level interviews in 10 days.
On my first trip, to both Moscow and Tbilisi, my dominant impressions were those of the hospitality that shone through the shabbiness. Deep beneath the squalor on much of the surface, I was impressed by the sheer beauty of many of the stations on Moscow's underground metro. "Now I understand the difference between communism and capitalism," I mused to my hosts. "In capitalist countries, we put the marble in the banks. Here in Moscow you put the marble in the people's subways."
Despite what I'd heard about the godlessness of communists, I was deeply moved by the music of the Russian Orthodox liturgy as high tenors soared over the deep bass rumbling from the corners of an incense-filled cathedral in Tbilisi. It was not what I'd expected. As people milled about in street clothes with an informality that contrasted with the stiff composure of Episcopalians in straight pews, I couldn't help noticing the verticality of this supposedly classless society: not just the soaring tenors, but also the screeching sirens on big Ladas as they roared through Moscow's then-empty streets chauffeuring members of the Politburo. "Our congressmen and senators can't get such royal treatment," I observed with wrinkled brow.
On my second trip in 1986, I heard the first rumblings of glasnost (openness) and perestroika (restructuring). I wanted to write a column titled, "From Russia With Hope," but I was dissuaded by the late Paul Posner, brother of Vladimir Posner, who later became half of an American TV team with Phil Donahue and is now a leading commentator on Russia's Chanel One. As Paul and I sat together on a flight to Paris, he convinced me that hope was premature. But he was wrong.
The Berlin Wall came down in 1989, and on my third trip to Russia in 1991, I was impressed by the new supermarkets. Gone were the long lines of people waiting for whatever food was available that day. Gone was some, but not all, of the squalor. Privatization was bringing consumer goods onto formerly empty shelves. But, let's face it, privatization Jeffrey Sachs style — namely, the abrupt "cold turkey" model that seemed to have worked in Poland — was a disaster in Russia. A select few who soon came to be known as the oligarchs amassed fabulous wealth while peasants saw their pensions disappear in gales of inflation.
On my fourth trip in 2005, the overwhelming message I got from the 28 interviews I conducted was this: "We're never going to go back to the old ways. We now know better than to embrace a system in which we pretend to work and they pretend to pay us; in which everyone is equal — equally poor. We embrace freedom, capitalism and democracy. But we want to do it our wayYou Americans are arrogant. Back off!"
But did we? No. Despite verbal guarantees given during Ronald Reagan's negotiations with Mikhail Gorbachev at Reykjavik that NATO would not push right up against Russia's borders, the bloc did just that under American leadership, not least via Victoria Nuland's leaked urgings prior to the 2014 coup in Ukraine.
A second message I heard in 2005 was that the Russian economy was split into two sectors. The first is the extractive industries, mostly oil exported for vast revenues that enrich the government and military but not many of the people. The second sector, consumer goods, remains tragically undercapitalized. Despite my interviewees' wishes that revenues from the first sector subsidize the second, they were pessimistic. Entrenched interests in the government and military cared too little about developing Russia's consumer economy.

Latest Impressions

So what are the dominant impressions derived from my recent trip? Of a country suffering under sanctions? A little, but not much. Of a country poised to conquer the West? Absolutely not. To the contrary, I've seen festivities. I've seen wealth. I've seen people on the streets who are free and highly self-expressive. The postures, the gaits, the eyes, the clothing!
"Oh, but you were just in Moscow, where the wealth is concentrated. The rest of Russia is still in the 12th century," you might object.
But we spent a week in Yekaterinburg, Russia's fourth-largest city, two time zones east of Moscow on the edge of Siberia, and I've rarely seen so many building cranes. The Boris Yeltsin Presidential Center and Museum in Yekaterinburg is an architectural wonder. The mayor is a lanky 6-foot-5, 54-year-old runner straight out of central casting, vibrant and impressive, who began his career as a poet.
Aside from all of the particulars, all of the little gems of joy, all of the glimpses of beauty in architecture old and new, the exotica that is unlike home . . . it didn't take long for two generalizations to dawn. The first has to do with the two sectors of the economy I had heard so much about in 2005. Sanctions are forcing the Russians to capitalize their consumer economy with import substitution, precisely as they needed to but were having such difficulty doing prior to the sanctions. Less able to import many consumer goods, they are learning to make their own. And with their vast stores of natural resources, well-educated workforce and extreme ingenuity, they are succeeding.
The second has to do with the comparison often made between China's and Russia's paths toward modernization, economic reform prior to political reform for China, political reform prior to economic reform for Russia. Until now, especially during the chaos of an American-guided, bungled privatization during the 1990s, it has looked as though the Chinese path was vastly superior. But now that tensions with the West over the annexation of Crimea have strengthened the hand of Russian strongman Vladimir Putin, we may see a new brand of autocratic capitalism in Russia that rivals autocratic capitalism in China. The Russians are doing it their way and, to this observer, it's working quite remarkably.
To be balanced and fair, not all is rosy in Russia. In addition to the doping scandal that kept Russian competitors out of the Rio Olympics and stoked the standard Hollywood image of those nefarious Russian villains, one can't deny Putin's restrictions on the freedom of the press. The government recently labeled the last free polling organization, the Levada Center, an enemy of the state. Its place on "the list" will probably lead to its demise.
Some businessmen and intellectuals are not happy with Moscow's beautification. Crony capitalism and the lack of a free press are, in their view, too high a price to pay to pacify the people with "bread and circuses." That said, there was almost universal disappointment among Russians with the anti-Russia slant of the American press.
One final thing: Did I or my traveling companions experience a shred of anti-Americanism? No. Not one shred.

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