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3 October, 2011  ▪  Michael Binyon

The Cold Peace

Britain is one of the largest Western investors in Russia, yet has worse political relations with Moscow than any other major Western power.

It was long seen as one of the most difficult diplomatic encounters that David Cameron would make since he became Britain's Prime Minister last year, and his one-day official visit to Moscow proved as awkward and unproductive as pessimists had forecast. There was no political breakthrough, no important trade deals were concluded and the atmosphere between Mr Cameron and the two Russian leaders, President Dmitry Medvedev and Prime Minister Vladimir Putin, remained distinctly cool.

Britainis one of the largest Western investors in Russia, yet has worse political relations with Moscow than any other major Western power. This paradox lent urgency to Mr Cameron's attempt to repair London's fractured ties with Moscow, which were deeply damaged in 2006 after the murder of the exiled Russian dissident Alexander Litvinenko in London. Apart from Tony Blair's participation in the G8 summit meeting in St Petersburg in 2007, there have been no visits by British or Russian leaders to each other's countries for over five years.

The timing of the visit in September was also extremely awkward. It fell on the fifth anniversary of the Litvenenko murder by a Russian security agent. And it came at the start of the Russian presidential campaign, which has all but paralysed decision-making in the Kremlin. For domestic political reasons, neither Mr Cameron nor Mr Medvedev could make any clear concessions to improve the frosty Anglo-Russian relations. Indeed, after the visit, a senior Kremlin aide said that relations had not been "reset" as they had been with America, nor had any breakthrough been achieved.

Mr Cameron decided to keep the visit as short as possible, and was in Moscow for just one day. The Prime Minister took a large trade delegation with him, and spent much of his time calling for reforms that would make it easier for British businessmen to operate in Russia — a crackdown on rampant corruption, more transparency, a clearer legal code, fewer arbitrary decisions and less political interference.

But although Mr Medvedev has also called for exactly the same reforms in Russia, especially at the St Petersburg International Economic Forum in June, he was irritated by Mr Cameron voicing these concerns in public. At a joint press conference he pointedly remarked that corruption also existed in Britain, and he made no promises of any action on these issues.

He was also angered by Britain's continued demand for the extradition of Andrei Lugovoy, the man accused of poisoning Litvinenko, who is now a Duma deputy. President Medvedev questioned the fairness of Britain's legal system, after Mr Cameron said the Litvinenko case had not been "parked". Britain also pressed privately on other areas of concern including press freedoms, the rights of opposition parties, greater freedom for non-governmental organisations. But little was said on this publicly, as Mr Cameron was determined to keep the atmosphere at least superficially cordial. He did not mention the Khodorkovsky case to Mr Putin or Mr Medvedev, though he discussed this and other human rights issues at a meeting with Dmirty Muratov, the editor-in-chief of the opposition newspaper Novaya Gazeta.

At the same time, the Kremlin failed to get many concessions from its guest. The biggest issue for Russia is Britain's extremely tight visa regime, the length of time and difficulty of getting a British visa and the deliberate restrictions on visas for Kremlin officials. With more than 150,000 Russians living in London and thousands of tourists wanting to visit Britain every year, this is clearly a big irritant for Moscow.

Though Britain would certainly prefer a return of President Medvedev in March, Mr Cameron could not be seen to signal any preference, especially as it appeared Vladimir Putin, currently prime minister, would reclaim his old job as president. Mr Cameron did in fact have a long talk with Mr Putin which was later described by Britain's foreign secretary William Hague as "constructive" and "businesslike" and since the visit, Mr Putin has been essentially nominated by his party to run for president and is certain to win the election, with Mr Medvedev likely to become prime minister in his place.

Yet despite the fact that political relations between the two countries are lukewarm at best, economic ties between Britain and Russia are still growing. British goods exported to Russia are already worth £3.5bn, an increase of 50 per cent over last year. The volume also grew by two thirds in the first half of this year. The British Prime minister was hoping for a further £215m worth of deals to be struck during his visit, though exact figures have not yet been released. And with London now the favourite Western city for Russian companies floating their initial public offerings on the stock exchange, Mr Cameron said he would support Russia's accession to the World Trade Organisation.

One irony of the visit was the presence in the British delegation of Bob Dudley, the head of BP, who was forced to flee Russia three years ago after a campaign of harassment against him. BP, which has a huge stake in the Russian energy market, had just failed to conclude a deal for joint exploration of the Arctic with Rosneft, after the deal was blocked by Russian businessmen from TNK, which is in a joint partnership with BP.

This clearly angered Mr Putin, and on August 31 BP's office in Moscow was raided in connection with a lawsuit by the minority shareholders in the TNK-BP deal. Britain saw this as typical of the overt political interference which is hampering British investment in Russia, and Mr Cameron mentioned the case. Two days after he left Moscow, the Russians backed down — BP won a court appeal against the court ruling authorising the raid. The court said such actions must be stopped.

The Cameron visit was also intended to improve international and multilateral relations between Britain and Russia. There have been sharp disagreements on this front recently as well: on Libya, on Syria and on sanctions against Iran. Britain is keen for closer Russian co-operation in the UN Security Council on the Middle East peace process, curbing nuclear proliferation, climate change, limiting weapons of mass destruction and curbing international criminal syndicates.

There appeared to be some progress in this regard, but Mr Cameron did not succeed in softening Russia's opposition to tougher sanctions on Syria or its anger at the NATO operation in Libya, which it had earlier denounced.

Clearly there was no breakthrough during Mr Cameron's brief visit and furthermore, it appears that Moscow was not seeking one. For while the visit was covered in detail in the British press, in Russia it barely got any mention in newspapers or on television. It will clearly be some time before there is a thaw in Anglo-Russian relations.


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