Wider Europe

Welcome to Wider Europe, RFE/RL's new newsletter focusing on the key issues concerning the European Union, NATO, and other institutions and their relationship with the Western Balkans and Europe's eastern neighborhoods. To subscribe, click here.

I'm RFE/RL Europe Editor Rikard Jozwiak and this week I'm drilling down on two major issues: whether the EU's "solidarity lanes" will get enough grain out of Ukraine and whether the OSCE will be able to pass a 2023 budget despite Russian objections?

Brief #1: How To Get Grain Out Of Ukraine

What You Need To Know: On October 29, Russia suddenly announced that it was walking away from the UN-mediated Black Sea grain deal that since mid-July has allowed nearly 10 million tons of grain to reach the rest of the world from Ukrainian ports previously blocked due to the war.

The deal was welcomed, notably in the Horn of Africa where food shortages have been acute in recent months.

Only a few days later, however, Moscow said that it was coming back to the deal after talks with Ankara, which all along has played a crucial role in keeping sea lanes open.

With the deal up for renewal on November 19 and the extent of the fighting in Ukraine hard to predict, attention has shifted to the European Union to once again increase deliveries of Ukrainian products by land.

In May, when the Black Sea ships remained anchored, Brussels launched so-called "solidarity lanes" -- a logistical network between the EU and Ukraine that utilized rail, road, and inland waterways and involved the customs authorities of all the countries involved.

But can the capacity of these lanes, which are still in use, be increased? Just in case, that is, the grain deal breaks apart again.

Deep Background: The EU's solidarity lanes, which mainly go via Poland and Romania, have been fairly effective so far. From May until October 20, more than 14 million tons of agricultural products, notably wheat, corn, and sunflower oil, had been exported using the lanes, in addition to 15 million tons of nonfood items such as steel and oil.

Some political measures to speed up transit at the EU-Ukrainian border were taken immediately: for example, a zero VAT rate on Ukrainian goods that will last at least until the end of the year; exemptions from quotas and tariffs until June 2023; and the waiving of some phytosanitary checks on animal products not destined for the EU market.

Yet it is clear that transporting Ukrainian produce via the country's Black Sea ports in normal times is both cheaper and easier as ships can move larger quantities in one go. There have been calls for Brussels to invest substantially in infrastructure on its borders with Ukraine but also to fund and bolster the roads, railways, and waterways both in Ukraine and leading to Ukraine, which have been overwhelmed with lines sometimes several kilometers long.

Drilling Down

• In late September, at a background briefing, EU officials said they were starting to see capacity limits and bottlenecks at the two main lanes: the "Northern route," via Poland, and the "Danube route," leading to the port of Constanta in Romania. Hammering home why more investment was needed, waiting times could constitute 40 percent of total logistics costs, meaning that each ton of grain would become 80-90 euros ($79-89) more expensive to transport on land.
• The problem is that the EU budget for 2022 is already quite stretched and there is still no deal in place when it comes to Brussels' financial support for Ukraine in 2023. Yet it's been suggested that there are some smaller investments that could make a difference in the short term. To send EU customs personnel to front-line countries such as Poland to faster check the cargo is one option. Other possible solutions include more parking spaces for cargo traffic at the borders, additional lanes to separate commercial and private traffic, or even entirely new border crossings. Already this fall, the renovation of one crossing point along Ukraine's border with Slovakia is finished -- and two new crossings along the Ukraine-Romania border should soon be ready.
• EU officials also hope they can utilize some recent legislation: Ukraine's accession to the Convention on Common Transit on October 1. The treaty, which has already been in place between the EU and several non-EU European countries, creates common procedures for the international transit of goods and considerably reduces the amount of paperwork. EU officials have described Kyiv's joining as "a potential game changer" that can reduce customs times "from minutes to seconds." Yet they have also cautioned that a certain "phasing-in" period for Ukraine is needed and this could take some time.
• Other costlier options, such as dredging the Danube to increase river traffic and finding a solution to the different railway gauges used by Ukraine and Poland, might be useful, but could also take years. At least in the short-term, the "solidarity lanes" could lighten some of the burden in case the grain deal collapsed again -- but that's about it.

Brief #2: Is The Cash-Strapped OSCE Going To Survive?

What You Need To Know: By the end of the year, the Organization for Security and Cooperation in Europe (OSCE), must unanimously agree on its 2023 budget. But just like the 2022 budget, there is a risk that no deal will be reached. In 2022, the OSCE survived by juggling bills under emergency monthly allotments. The question is whether the Vienna-based organization can survive another year like this.

When OSCE Secretary-General Helga Schmid presented the 2023 budget to the 57 member countries of her organization in late October, she didn't mince her words. The OSCE is "in a dire state," she noted in her address and explained: "A decade of zero nominal growth has brought us to rock bottom. There is just no fat to trim. We are cutting bone now."

Deep Background: The proposed budget for next year is 144 million euros ($143 million) -- an increase of 4.6 percent or 6.4 million euros over the last agreed OSCE budget for 2021.

The money, which is provided by the participating states of the organization, goes toward employing the 550 people in the OSCE's various institutions and some of the 2,330 people working in the field.

The organization's field operations are mainly in the Western Balkans and Eastern Europe and could be dealing with anything from support of local law enforcement to early warning systems to conflict prevention. Most of the field operations also have staff members funded by their national administrations.

Officials in Vienna hope that the OSCE can be kept alive without a budget, instead surviving on projects financed by individual member states in cooperation with the OSCE and their staff. Yet the OSCE cautions that the lack of solid funding could mean that it might be harder to attract or retain qualified staff.

Drilling Down

• With inflation hitting double digits in Austria this year, the OSCE's number crunchers have calculated that Austria's real purchasing power has decreased 10 million euros ($10 million) in 2022 alone. This hits hardest when it comes to using parts of the Hofburg Palace, the former imperial winter residence of the Habsburgs, which has been the OSCE's headquarters for years. The rental costs have doubled in the last few years to well over 1 million euros per annum.
• Yet it is also clear that Russia, an OSCE member, is resisting passing the budget in its current form. When commenting on the 2023 proposal, Russia was, according to internal OSCE documents seen by RFE/RL, objecting to any references to the "war in Ukraine," or similar wording to that effect, in the nearly 500-page document.
• Moscow has objected to any rise in the budget for what is often referred to as the "third dimension" of the OSCE. This covers the activities of the Office for Democratic Institutions and Human Rights (ODIHR), which is known for its election monitoring. Also irking Russia is the so-called "Moscow mechanism," which allows a majority of OSCE states to send a mission of experts to another OSCE country to report on any problems there. Twice during the war in Ukraine, this mechanism has been triggered against Russia, much to the chagrin of the Kremlin -- once to probe potential war crimes committed in Ukraine and once to report on human rights violations inside Russia.
• When debating the proposal, the Russian delegation also noted that the soaring inflation was triggered by "the aggressive foreign policy of EU and NATO countries" and that they had to bear political as well as financial responsibility for their actions. In notes from a closed-door meeting that RFE/RL has seen, the Russian delegation responded to allegations that it was hijacking the budget discussions by noting that the issues were "better addressed to those delegations themselves," adding that "if those delegations would not have sent more weapons to the region, the situation would have improved months ago." Obviously, it was a clear reference to the United States and other European countries that have sent arms to Ukraine.
• Discussions on how to get the OSCE budget over the line are now in full swing in Vienna. Other options discussed include the possibility of agreeing a two-year budget so that these discussions won't resurface every year, or creating an automatic rollover process that requires consensus only for new commitments. The tricky part for the OSCE is if any of these options can get around the Russian objections.

Looking Ahead

There is a mini-plenary of the European Parliament in Brussels on November 9-10. The chamber will give the thumbs up to Croatia joining the open-border Schengen zone by January 1, 2023.

The final decision on Schengen entry will still need to be taken by EU member states, though, and is expected on December 9 when the bloc's interior ministers meet. For Croatia, all indications point to a green light. The case of Bulgaria and Romania, also hoping to join Schengen, might be a little trickier.

The European Parliament supports the pair, but the Netherlands is reportedly still reluctant. Bucharest and Sofia could well have to wait a little bit longer than Zagreb on this one.

On November 9, the European Commission is set to present its proposal for how to support Ukraine financially for the next year. As mentioned earlier in this newsletter, the proposal will suggest that Brussels provides 18 billion euros, equivalent to 1.5 billion euros per month in 2023.

The issue, as always when it comes to economic support, will be how to raise the money and if the cash should be dispersed in grants or loans or a combination of the two. Discussions are already under way among EU member states, but a deal has to be struck soon in time for the first budget disbursement in January 2023.

In another development previously mentioned here in the Wider Europe Briefing, it has now been confirmed that Swedish Prime Minister Ulf Kristersson will travel to the Turkish capital, Ankara, on November 8 to meet Turkish President Recep Tayyip Erdogan.

This comes after the NATO Secretary-General Jens Stoltenberg visited Turkey last week. In an interesting press conference in Ankara, Stoltenberg said that the Nordic NATO wannabees, Sweden and Finland, have done everything that Ankara had asked of them. Turkish Foreign Minister Mevlut Cavusoglu, however, acknowledged that progress had been made but that it still wasn't enough.

That's all for this week. Feel free to reach out to me on any of these issues on Twitter @RikardJozwiak or on e-mail at jozwiakr@rferl.org.

Until next time,

Rikard Jozwiak.

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And you can always reach us at newsletters@rferl.org.

Welcome to Wider Europe, RFE/RL's new newsletter focusing on the key issues concerning the European Union, NATO, and other institutions and their relationship with the Western Balkans and Europe's eastern neighborhoods. To subscribe, click here.

I'm RFE/RL Europe Editor Rikard Jozwiak, and this week I'm drilling down on two major issues: What obstacles could slow down Finland and Sweden's NATO accession? And is Brussels edging closer to punishing third-party countries that help Russia?

Brief #1: What Could Spoil Sweden And Finland's NATO Accession?

What You Need To Know: Twenty-eight out of 30 NATO allies have now ratified Sweden and Finland's protocols of accession to the military alliance. Which two opted out? Turkey and Hungary. But there does seem to be some movement in Ankara and Budapest. According to Hungarian officials, the parliament should vote on the issue at the end of November and wrap up the process before Christmas. As for Turkey, which so far has chosen to see how Finland and, more importantly, Sweden implement the remainder of the trilateral memorandum signed in Madrid in June, there are also some signs of a window of opportunity opening.

Deep Background: The thing to look out for this week is the likely trip by NATO Secretary-General Jens Stoltenberg to Ankara. It comes after the new Swedish prime minister, Ulf Kristersson, had what he called "a constructive phone call" with Turkish President Recep Tayyip Erdogan last week. Kristersson recently indicated he was ready to travel to Turkey "as soon as possible" and Erdogan confirmed a meeting will take place even though no date has been set.

Ankara will certainly look at how quickly and keenly Sweden implements provisions from the June memorandum. The previous Swedish government delivered on some aspects of the pact: A 2019 arms embargo on Ankara was promptly lifted, and there have been moves to stop financing and support for Kurdish groups in Syria. But those were the easy parts. The question now is how to deal with the trickier challenges, namely Sweden clamping down on the Kurdistan Workers Party (PKK) and extraditing people Turkey deems to be terrorists.

Both Finland and Sweden have long classified the PKK as a terrorist organization, but in the memorandum they committed to "preventing activities of the PKK and all other terrorist organizations and their extensions, as well as activities by individuals in affiliated and inspired groups or networks linked to these terrorist organizations." Exactly how to identify so many members of this network is anyone's guess, but Sweden -- home to an estimated 100,000 people of Kurdish origin -- will probably have to be more vigilant.

Drilling Down

• The extraditions will be the real litmus test for Sweden. So far, two extradition requests have been approved, but it is still unclear how many more Ankara is seeking. Numbers circulating in the media have ranged from 18 to 73 people, but officials I spoke to say what Turkey is looking at more than anything is Sweden’s willingness to at least entertain the requests.
• The new Swedish government, established in mid-October after a tight election win a month earlier, might find it easier than its predecessor to deal with Ankara for several reasons. The three right-wing parties that make up the minority government are all staunchly pro-NATO, which wasn't the case with their main governing predecessor, the Swedish Social Democratic Party. They might also find the extraditions easier to swallow considering it’s no longer an electoral issue and Swedish Kurds have traditionally been left-leaning -- in other words, they're not a hugely important voting base for the right-wing parties in power. Notably, Amineh Kakabaveh, an Iranian-born Kurd and former peshmerga fighter who in the previous Swedish parliament was an independent deputy and political kingmaker, lost her bid for reelection in the latest polls.
• The government, however, relies on the support of the far-right Sweden Democrats to secure a working majority. The Sweden Democrats have switched their position on NATO and are now in favor of joining, but the party’s anti-immigration rhetoric and swipes against Islam could create further tensions with Ankara.
• When can Sweden and Finland finally become members? Some officials say everything could be done and dusted by the end of this year, but the process could very well spill over into early 2023. It's worth considering, too, that Erdogan is set to fight a protracted presidential election next June and the Finns head to the polls in early April. According to EU diplomats familiar with the issue, there is a renewed willingness to sort this out well before then.

Brief #2: What's Next For EU Sanctions?

What You Need To Know: In the latest sanctions package imposed on Russia, adopted by the European Union earlier this month, the bloc opened up the possibility of targeting individuals and companies in third countries for helping EU entities circumvent the restrictive measures imposed on the Kremlin.

This could become an important tool to use against countries in the bloc's neighborhood; it would also be a significant U-turn for the EU. After having railed against the United States for applying and threatening companies with secondary sanctions for years -- including some EU firms -- Brussels now appears to be moving in the same direction in an attempt to choke the Russian war machine through its secondary and tertiary partners.

Deep Background: Even though Brussels is edging closer toward to what is known as sanctions extraterritoriality, there are still limits. While any potential future measures apply equally to EU and non-EU actors, there must be a clear EU link. Thus, the measure is only applicable to people or companies if they help EU people or companies circumvent EU sanctions on Russia.

In that respect, they lack the sweeping global scope of U.S. secondary sanctions and would likely lack the same depth. For example, Brussels would only target a company or person with visa bans and asset freezes, whereas Washington can cut off any sanctioned entity entirely from its financial system, creating much larger economic consequences and reputational damage. The main question remains, however, as to whether extraterritoriality measures will be used at all; so far even the United States has refrained from using its secondary sanctions toolkit in relation to third countries' dealings with Russia.

Drilling Down

• The EU diplomats I spoke to on the condition of anonymity indicated that the move to broaden the scope of EU sanctions should primarily be read as scare tactics to force third countries into aligning with the EU position on the issue. Some countries, notably EU candidate countries Serbia and Turkey, have not followed Brussels' lead on sanctions to date. Brussels, however, remains reluctant to target countries in its neighborhood, the main thinking being that it doesn’t want to be seen as pushing them away from the bloc.
• Diplomatic capacity is another potential obstacle. So-called sanctions evidence packages need to be prepared by member states and the European External Action Service, the EU's diplomatic service, which is already working overtime to find reasonable legal grounds to target Russian industries. Investigating third-country dealings might be too much of a bureaucratic strain. In many ways, Brussels is missing its own version of the U.S. Office of Foreign Assets Control, which administers and enforces American sanctions.
• Then there is the issue of legality. Even if evidence packages were to be prepared, they must also stand up to a potential challenge in the European Court of Justice (ECJ). Once again, Washington appears to have a smoother setup, as hinted at by one high-ranking EU diplomat: "The EU is accountable to the ECJ; the U.S. is accountable only to God."
• If the EU manages to overcome these hurdles and decides to use the new, widened scope, who will be targeted? That's anyone's guess, but it was telling that it was Cyprus and Greece who were allegedly instrumental in pushing for the bloc going toward extraterritoriality.
• Does that mean Turkey might be in the crosshairs? In a leaked European Commission document assessing the impact of the EU's Russia sanctions so far -- a document seen by RFE/RL -- Turkey, alongside China, is mentioned in a subchapter on circumvention with the text stating that "the value of Turkey's exports to Russia nearly doubled since the second quarter [of 2022]." The document also states that "exports of some member states to Turkey have also risen sharply over 2022."

Looking Ahead

This week will be a bit slower due to the All Saints holiday on November 1, marked across some parts of Europe. There are still, however, two meetings in Germany to watch. On November 3, the leaders of Albania, Bosnia-Herzegovina, Kosovo, Montenegro, North Macedonia, and Serbia will be in Berlin to sign three agreements.

One agreement enables people from these six Western Balkan countries to only use IDs to travel across their respective borders. The other two agreements will ensure mutual recognition of university diplomas as well as vocational qualifications. And on November 3-4, G7 foreign ministers will convene in the German city of Munster. Talks will mainly focus on Ukraine, including more potential sanctions, financial aid, and weapons deliveries.

We are slowly approaching the end of the year, and that usually means one thing in Brussels: summit time. In December, the EU squeezes in yet another meeting: a first-ever EU-ASEAN summit slated for December 14. Diplomats are already working on a draft leaders' statement for the meeting, and the war in Ukraine will likely feature prominently.

The EU was badly damaged by accusations, largely from the Global South, that its sanctions on Russia caused food prices to soar worldwide. And in the latest draft leaders' statement, seen by RFE/RL, Brussels is pushing for language that states that "we condemn the use of disinformation by Russia on this crucial issue, aimed at distorting the link between global food prices and Russia's actions in Ukraine."

The draft statement adds that "in this context, we recall Russia's blockage of Ukrainian ports, the deliberate destruction of Ukrainian agricultural facilities, and Russia's restrictions imposed on its own export of agricultural products and fertilizers."

That’s all for now. I really hope you enjoyed the first edition of Wider Europe. To subscribe, click here. Please feel free to send me any questions, comments, or tips that you might have. You can also follow me on on Twitter @RikardJozwiak.

And you can always reach us at newsletters@rferl.org.

Until next time,

Rikard Jozwiak