/ world today news/ In today’s complicated and dynamic geopolitical environment, countries increasingly have to rely on their diplomacy. The ability to negotiate lies at the basis of the formation of national priorities and their defense. Foreign policy is an integral part of this process. It is an unavoidable factor without which strategic goals cannot be achieved.
In economics it is no different – if you do not have the ability to negotiate on the principle of mutual benefit, you are doomed to failure. When a country conducts trade negotiations, it must inevitably respect two main components – its national interest and the principle of mutual benefit. Unfortunately, in Bulgaria the debate about the national industrial policy is absent. The industrial policy is one of the most important prerequisites for economic growth and guaranteeing energy security, as it is primarily oriented towards the strategic branches of the state economy. In continuation of these thoughts, we can state that we cannot have a successful industrial policy if we do not have quality economic diplomacy.
Some experts argue that diplomacy in economics is not ordinary, it is “economic statesmanship”. We should ask ourselves the question “And do we master it?”
After our country abandoned “South Stream” in the summer of 2014, for some time the project stood in limbo. And so until December of the same year, when Russian President Vladimir Putin declared it unpromising and decided to replace it with “Turkish Stream”. The international situation at that time was also not flourishing – Russia was entering the first and most difficult year of the economic sanctions imposed on it because of the incident with Ukraine. The crisis in Syria was growing. Turkey was looking for new trade agreements and economic partnerships. By all accounts, it seemed that “South Stream” was indeed going down in history. And so until November 24, 2015, when Turkey shot down a Russian bomber in the sky over Syria. Russia responded with immediate economic sanctions against Turkey in every sphere of their mutual cooperation. The Turkish Stream project was also frozen.
Russia introduced sanctions against the Turkish state in early December 2015. An apology by President Erdogan in late June 2016 marked the beginning of normalization and the gradual lifting of trade restrictions between the two countries. The Turkish Stream project was revived. On October 10, 2016, Russia and Turkey officially signed a document on bilateral cooperation on the construction of the gas pipeline. The construction of “Turkey Stream” has already started – on May 7, 2017, the first section of the gas pipeline was laid in Russia.
The conflict between Russia and Turkey was a golden chance to restore “South Stream” – not only for us, but also for all of Europe. Today, from the distance of time, we can confidently say that it would have been a bold and daring move that would have paid dividends. Evidence of our short-sightedness is the intention of the European Union to buy Russian gas anyway. Today, Austrian and Italian companies are competing to participate in the construction of the sections of the revived Turkish Stream. On February 24, 2016, Gazprom, Edison and DEPA signed a memorandum on Russian gas supplies to Greece and Italy through the construction of interconnectors.
So far, all indications from the Old Continent are that, despite major differences with Russia, Europe is ready to cooperate with Moscow in one key area – energy. The European Union needs its energy security. Germany’s opposition to US attempts to block the construction of “Nord Stream-2” by introducing new economic sanctions against Russia is indicative.
Bulgaria had nearly half a year – from December 2015 to June 2016 – in which it could activate its diplomacy and at least try to revive South Stream. No one would be mad if we had at least tried.
However, if “Turkey Stream” really happens and EU countries decide to work with Ankara on gas supplies, it will highlight the strategic failure of our foreign policy in this case. It is well known that large energy projects are sometimes a powerful tool for political and economic influence. Through “Turkish Stream” our country will have to work not only with Moscow, but also with Ankara – something that would not have happened if “South Stream” had been implemented.
Obviously, gas projects are competing. Although the source of natural gas is only one – Russia, the European Union realizes that with “Turkish Stream” it must also take into account the interests of Ankara, and as is known, relations between Turkey and the EU have recently been quite unstable.
Recently, there has been talk in our country of resuming the project in the form of “South Stream-2”, the route of which should be identical to that of the original project. Austrian newspaper Der Standard claims that Austria’s OMV and Gazprom are considering reviving the project.
But in order to restart “South Stream” in one form or another, our country, as the main participant, must show whether it has the ability to conduct trade negotiations of strategic importance. One thing is certain – Bulgaria, in addition to ensuring its energy security, must not allow itself to lose its extremely important role as a transitor of natural gas for Europe – the receipts of the state company “Bulgartransgaz” from transit fees amount to about BGN 180 million .annually.
We should not forget another important benefit – such energy infrastructure becomes an indispensable part of the country’s national security. “South Stream” would have a much greater strategic value for Bulgaria than a possible Turkish Stream interconnector.
We should not miss another important point. The crisis in Ukraine and tensions between Moscow and Kiev have prompted Russia to look for alternative routes for the supply of natural gas to Europe. Gazprom will gradually reduce the capacity of the old gas pipelines passing through Ukraine. The goal is clear – bypassing Kiev and avoiding future gas wars, given the growing tension between the two countries. At the moment, the only source of natural gas for Bulgaria is precisely the “Trans-Balkan” gas pipeline, passing through Ukraine and Romania. In order to guarantee its energy security, our country must do more. Natural gas supplies and their optimal price must be guaranteed.
The accumulated mistakes in the field of energy over the years show that Bulgaria lacks a purposeful industrial policy in this strategic sector. If we focus on the problems in the production of electricity, we will see that the same processes are observed there. Since the beginning of this year, there has been increasing talk in the European Union about abandoning inefficient and less environmentally friendly power plants such as thermal power plants. If the countries adhere to the commitments of the Paris climate agreement of 2015, then in 15 years, around 2030, there should no longer be thermal power plants in Europe.
Is Bulgaria prepared for the moment when thermal power plants will go down in history?
In our country, thermal power plants account for about 40 percent of the electricity produced. This percentage shows us one thing – at the moment we simply cannot give up the thermal power plants. But what are our other options? Our country prematurely closed the first four units of the Kozloduy NPP before the end of their operational life. Already in 1990, we abandoned the almost completed nuclear power plant in Belene (with 40% construction completed and 80% equipment delivered, the plant should have been connected to the country’s power grid in 1992)
The energy future of Bulgaria is closely related to the creation of a far-sighted industrial policy in all branches of energy. Moreover, this policy should be a strategic priority, despite frequent changes of government. Historically, energy has always been the driver of industrial development. Today it is no different – all large and medium-developed industrial countries could not have reached this level if they had not ensured the profitability of their energy supplies.
In summary, we can say that our diplomacy must demonstrate courage, taking advantage of the upcoming presidency of the Council of the EU. It depends on whether we will be able to correct the mistakes made over the years. The price we will pay for natural gas also depends on the abilities of Bulgarian economic diplomacy. Bulgaria cannot afford any more laziness and carelessness, especially when it comes to its energy role in the Balkans.
#Energy #industrial #policy #economic #diplomacy
