Russia-EU relations in 2016: Looking for a way out based on the positives

A new beginning ?

Jan. 13 marked the beginning of the Gaidar Economic Forum held each year in Moscow at the Russian Presidential Academy of National Economy and Public Administration under the President of the Russian Federation (RANEPA).

With the falling price of oil leading to the ruble’s continuing devaluation, the discussion at the forum brought forward a number of urgent issues that are critical to Russian economic development in 2016 as well as over the long term.

One such topic was the future of Russia-EU relations and what might be done to re-establish the relationship now that there seems to be a deadlock in cooperation. During many years, the EU relationship was one of the most profitable ones for Russia and ensured a stable stream of revenues to the federal budget.

One of the most evident signs of both sides being ready to make steps towards each other was the rhetoric present at the first day of the forum. For instance, Russian Prime Minister Dmitry Medvedev stated quite clearly that Moscow is ready to re-establish cooperation with the countries of the European Union. “Sooner of later common sense will prevail and sanctions will be lifted. But for this to happen we need to make steps toward each other,” he said.

European representatives also expressed optimism about the revival of the dialogue. “As the year 2015 showed, we can work quite successfully together on a range of global issues. We achieved progress together on Iran, the Syrian crisis and the climate change agreement in Paris.

We are interested in working with Russia on addressing other global problems,” said Kristalina Georgieva, vice president for Budget and Human Resources at the European Commission.

What is more, she said, Russia and the EU think alike on some questions and there are areas where bilateral cooperation is still on a good level, for instance, in educational exchange programs.

In terms of trade, there are positive signs as well. According to Alexey Likhachev, First Deputy Minister of Economic Development of the Russian Federation, Russian exports to the EU in 2015 grew in terms of physical volume while the amount of foreign direct investment increased from $193 billion in January 2015 to $221 billion by July 2015.

A negative trend is present only during the last two years – during 2001-2013, the overall trade turnover between Russia and the EU grew six-fold. So, if not for the geopolitical situation, the positive trend could have continued even further.

Read more: Russia-EU relations in 2016: Looking for a way out | Russia Direct