In Sun Tzu’s “The Art of War,” the West can find a simple answer to a not-so-difficult question – what do we do with Russia in response to the Ukraine conflict? – in the quote, “If you know the enemy and know yourself, you need not fear the result of a hundred battles. If you know yourself but not the enemy, for every victory gained you will also suffer a defeat. If you know neither the enemy nor yourself, you will succumb in every battle.”
Cliché though it may be, the West is better off keeping Russia close-at-hand than it is isolating it; know the enemy. And, the West is also better off when it models the values it so aggressively protects; know yourself. Instead, the general attitude towards Russia has framed the issue from an indignant, self-righteous standpoint that triggers a black and white agenda in which the best solution to Russia’s aggression has so far been to exile it from global affairs and economies.
This is reductionist and naïve. It also fails humility, the operating principle being that the West can pass judgment despite its own record of violating sovereignty. The point here is not tit-for-tat or that a lack of innocence precludes the right to call out injustice when it is happening. The point is, when has avoiding the problem ever made it go away? The point is, pride comes before the fall.
The Fallout So Far
Let’s be real; the risk of excluding Russia through traditional methods such as boycotting its oil, a critical source of energy for the European market, does not outweigh the practical benefits of keeping an enemy close at hand. Can the West afford it? Does it even make sense?
The answer is no, not really. As a result of having cut Russian oil supplies by more than 80% in 2022, Europe’s heating, industrial processes, and power capabilities have also been cut, so to speak. Not to mention the suffering this creates for the everyday person who foots the bill, the time and energy expended to develop policies to counter the impact of such drastic cuts, and the potential for an economic recession as the stress of a looming winter may be the straw that breaks the camel’s back. This seems like a case of cutting one’s nose off to spite one’s face.
Limited oil, natural gas, and the subsequent inflation amounts to a national security crisis in Europe, particularly the Eurasian region. The winter will compound the effect of inflation, a potential wedge in the unanimous-based European Union system of member-State voting. Surely, there is a better solution than mutually assured destruction?
The Future of Falling Out
Let’s be blunt; the West needs a future with Russia in it. Instead of pretending like there is a choice to exclude Russia and towing the age-old line that Russia must suffer for its aggressions, the West needs to confront what this means.
If the current agenda that relentlessly pursues an isolated Russia continues, what will eventually happen is an alienated West that has limited insight into, or influence on, the goings-on of an economically detached and self-sufficient Russia. If the West continues its current foreign policy approach to Russia, it will catalyze a reduction in Russian dependence on Western energy markets and financial institutions, encourage Russian leadership and primacy over the nuclear energy market, and provide alternative options to the Western-dominated global landscape for states seeking to disentangle themselves from the specter of Western hegemony.
Russian president Vladimir Putin is pursuing a multi-polar world and, if pushed enough, will successfully develop Russia’s independent financial system – Financial Messaging System of the Bank of Russia or SPFS – into a viable counterpart to the West’s Society for Worldwide Interbank Financial Telecommunication aka SWIFT. As demonstrated by recent marketing of a digital ruble and Russian credit card, SPFS is on its way to being competitive.
Not falling out with Russia is a choice, and of utmost importance so that Russia does not achieve inhibited primacy in the nuclear energy industry. However, if sanctions as they are continue while at the same time the U.S. and Europe decrease or end purchasing of Russian nuclear exports, part of the West’s isolation strategy towards Russia, Putin’s vision of a multi-polar world will become a reality.
We do not want a world in which Russia leads a parallel economic system in competition with the West, and free of the current constraints imposed by SWIFT’s monopoly on banks. This would be the future of falling out with Russia. Nuclear energy has a lot to say on the matter.
Why Does the Nuclear Energy Industry Matter So Much?
Even though Europe has capped oil prices on Russian oil, the dent this makes in Russia’s role as a major energy exporter in the world may be moot when its nuclear energy materials, power, services, and technical assistance exports continue unhindered. You might say, well, let’s sanction the shit out of that, too.
It is not that easy, there is a reason sanctions have yet to hit Rosatom, Russia’s state-owned nuclear energy company that currently comprises 17% of the global nuclear fuel market. Domestically, Rosatom operates 11 nuclear power plants (NPPS) for a total of 37 reactors. Across the globe, 42 reactors are built with Russian technology and Rosatom is in the process of building 35 new reactors, the locations of these reactors striding countries such as China, Turkey, India, Pakistan, Ukraine, Egypt, Finland, and Hungary, making Rosatom a lead provider of a gamut of nuclear energy-related resources and the leader in reactor production. The Ukraine conflict underline the implications of Rosatom’s high profile in the nuclear energy industry: all 15 of Ukraine’s reactors are of Russian VVER design, including those at Zaporizhzhia, Europe’s largest NPP and which has been Russian-controlled since Mar. 2022.
When combined, the U.S. and Europe rely on Russia for 34% of their uranium and 48% of their enrichment services. As of August 2022, Russia makes roughly $200 billion dollars annually off of oil and natural gas exports, but with sanctions this does not reflect full earning power. Its nuclear industry exports count in the billions, at the very least, one article from April 2021 suggesting Russia’s overseas projects are worth approximately $130 billion. And that is just overseas projects in the making.
Though not yet the case, it is not beyond the realm of possibility that the economic power of Russia’s nuclear energy production could cover for losses from oil and natural gas sanctions. The U.S. and Europe are engaged in efforts to find an alternative solution to nuclear reliance on Russia, but with Russia’s established nuclear presence in both economies, along with other powerhouses like China, the cost of detaching it is going to be expensive for the U.S. and Europe. From Russia’s point of view – as it has such a diverse portfolio of reactor sites — would the absence of U.S. and European business matter in the long-term? However, before we can even get to balancing the economic equation, Rosatom’s main character role in nuclear energy is an inevitable practicality.
The cost of economic disentanglement would be high, but even higher would be the cost of extricating Rosatom from its entrenchment in critical international institutions and climate change strategies. Rosatom works with business partners in 50 different countries, is a member of the United Nations (UN) Global Compact Network, and accounts for 210 million fewer tons of greenhouse emissions each year. Major partners in international relations realm include the International Atomic Energy Agency (IAEA), the UN’s nuclear watchdog, and the Organization for Economic Co-operation and Development’s (OECD) Nuclear Energy Agency (NEA). This kind of pedigree and integration into the global energy market and trajectory essentially insulates Rosatom as a non-expendable leader in the nuclear industry now and in the long-term future. When it comes to nuclear energy, the U.S. and Europe would do better to opt in than opt out; better to know thy enemy than to suffer defeat.
Know Yourself
Admitting the interconnectedness of and reliance on Russia’s energy is not admitting weakness. Ignoring the implications of an exclusively exclusionary foreign policy approach to Russia is. None of the above commentary is to say that we should be friends with Russia or to sympathize with Russia’s aggressions. It is simply to offer a window into another world, one in which retribution does not blind practicality. What does it mean that the EU is on its ninth successive sanctions’ package, which require unanimous votes of support from the 27-member EU States? What has the West’s obsessive isolation campaign against Russia really achieved? Or maybe better said in Sun Tzu’s “The Art of War,” “there is no instance of a country having benefited from prolonged warfare.”
[Photo by Meghas, CC BY-SA 3.0, via Wikimedia Commons]
The views and opinions expressed in this article are those of the author.
Rumyana Hulmequist is a Master of Human Rights student at the University of Minnesota’s Humphrey School of Public Affairs.
