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December 28, 2008Russia: 2008 in Review
The year 2008 proved to be a very turbulent one for Russia, both domestically and internationally. The year started of on a note of stability and assurance, as former President Vladimir Putin's hand-picked successor, Dmitry Medvedev, former CEO of Russian energy giant Gazprom, easily won presidential elections in March. The election was marked by its lack of any discernible competition from other Russian politicians, with the majority of the country determining that Medvedev's succession was a foregone conclusion. The election itself was a huge disappointment for numerous policy analysts worldwide who predicted that Putin would stay for a third term as President, either as the head of Russia or as head of the union between Russia and Belarus.
Following the election, the country was then witness to a remarkable political transformation as Putin became the Prime Minister in May - officially second in command of the country - leading the world to breathe a sigh of relief, so to speak, that he would still control the levers of power and continue his domestic and international agenda from prior years.
August is now regarded as the watershed moment in Russia's present and future approach to its "Near Abroad," states that used to make up the USSR. On August 7, Georgian forces shelled the positions in Tskhinvali, the capital of the breakaway region of South Ossetia (a strong pro-Russian region that broke away from Georgia in the early 1990s). Russian forces, already having a limited military presence in South Ossetia, responded with a full-scale invasion of the breakaway region and then Georgia proper. Russian military, backed by aircraft, tanks and armored vehicles, steamrolled over beleaguered Georgian forces and in days were mere miles away from Tbilisi, the Georgian capital.
This short war resulted in an embarrassment for the United States, since Georgia was one of the most pro-American and pro-Western countries of the former USSR, and Washington was unable to offer any tangible defense of its ally nor give it enough political-military support to stand ground against Moscow. Russian media and public watched as Georgia almost came undone as a country under the weight of the successful Russian military operation.
The aftermath of this war is still unfolding, as the United States, European Union, Georgia and Russia are trying to officially determine where to put the blame for this conflict. The most weighty outcome of this conflict was renewed pride and confidence of the Russian government and people in its armed forces, which conducted an orderly and successful large-scale operation - the first of its kind after the fall of the USSR in 1991. Another major outcome was the further straining of the US-Russia relationship to the point of the "New Cold War," as Washington sought new ways to counter the growing global perception that following the war against an American ally, Russia emerged as a powerful challenger to Washington-dominated global security arrangement.
Following a relative "confidence high" after a war against a small republic, Russian economy went into major shock as the global financial crisis first hit the credits needed to keep its economy going, and then led to the collapse of the oil prices to the lows not seen since the late 1990s. Practically all spheres of the Russian economy - from construction, agriculture, tourism to domestic industry - were affected in a matter of months. The collapse of the oil prices from $120 to roughly $40 per barrel led to the shortfall of billions of petro-dollars to the Russian coffers.
These factors have put the national currency under intense strain and triggered huge stock market losses and capital outflows. The conclusion drawn by the Russian political establishment from the crisis was that Russian economy was affected precisely because it was part of the global economy, and that if Russia wants to be a major global player, it needs to get used to and share the effects of world-wide economic stresses, if and when they occur. Nonetheless, Russian government promised far-reaching assistance to the affected sectors of the economy, pledging that Russia will thrive regardless of the global economic shocks.
Russian foreign policy continued through 2008 to showcase signs of confidence and resurgence. For the first time since the collapse of the USSR, Russian Navy sent its ships to America's backyard - Venezuela and Cuba. Russian government emphasized that such visits were symbolic in nature and the main reason Moscow was interested in Central and South America was economic in nature. Washington watched closely as the Russian flotilla visited Venezuela and then Cuba.
However, even as the Russian military prowess was on display in the capitals of two staunchly anti-American countries, President Medvedev and Prime Minister Putin both hoped that Russian-American relations will improve with the election of Senator Barack Obama as the next US President.
Not all news are bad in Russia as 2008 draws to a close and its economy is slowing down, leading to grim forecasts for the next year. For the second time in a decade, a Russian beauty won a global beauty pageant. On December 14, Ksenia Sukhinova, 21, won the Miss World title, proving that at least some stereotypes about Russia are true. Back in 2002, Russian Oksana Fedorova also won the Miss Universe title.
What can Russia expect in 2009 as it looks back at 2008? Perhaps retrospection on its role as a major global power - that its war against neighbors can lead to intense scrutiny from the rest of the world, that the global economics shock waves are felt very intensely by its economy that is still in the process of transition. For the last eight years, Russian people have given in on some freedoms in exchange for the growing economic stability. If Russian economy continues its nosedive into 2009, this population-government bargain can be annulled, with severe consequences for the entire country and major parts of the world. As the world security, financial and economic picture slowly starts to change as the country heads into 2009, this past year should be looked upon as the test run of the new Russia still trying to determine and define its role amongst equal and lesser powers.
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