One crisis can help alleviate another.
Russia is isolated now, but the world economic crisis will be an opportunity for Russia to reconcile with Western countries. The Russian government thought that with its oil and half a trillion dollars in reserves it was invincible to the economic crisis. This was an illusion. Most of the Russian stock market was owned by foreigners and in recent weeks these foreigners desperately needed money at home, so they quit the Russian market altogether. Today it has only 30 per cent of its May value. The Russian banks and, consequently, companies have much less access to foreign credit. As a result, economic growth in general and industrial growth in particular is very likely to slow down in Russia. The price of oil is falling because of the fear of a recession in the United States and it is generally accepted that the price of oil is vital to the Russian economy. The ultimate result is that Russia, suddenly for some, appears to be very integrated and very dependent on the global economic circumstances.
The West needs Russian help, too. Iceland is negotiating a loan from Russia to save its financial system. Russia is now the seventh largest economy in the world with a huge potential for growth. Its natural resources are unrivaled in the world. Russia is a Christian country with its cultural, ethnic and aesthetic roots tracing back to Ancient Greece and Byzantium. Undoubtedly, it is going to be of a mutual advantage for the West and Russia to reconcile.
There are signs that the Russians now understand that they are too dependent on the West to afford isolation. The Moscow court has ruled that the pretensions of the Russian tax authorities against the British Council are illegal. As a result, the British Council might re-open its branches in Russia. Britain has also sent a new ambassador to Russia, who has promised an attempt of a reconciliation. The quarrel between the Russian and the British investors of the joint venture TNK-BP have been solved to the satisfaction of both sides. These are promising signs that both sides are willing to turn around Britain and Russia’s relationship.
The global economic crisis might be a good opportunity for reconciliation between Russia and the West, as it is now evident that Russia is too dependent on the rest of the world to afford isolation. Either Russia is going to roll back into something terrible or it will have to bargain with the E.U. and the U.S. There is no middle way in this equation. The circumstances of the present economic calamity presents opportunities for both sides. Reconciliation is a good choice, but the West needs to avoid humiliating Russia as they did in the 1990s.