Chris Gilmour reminds us of the famous words of Winston Churchill as he takes a closer look at the conflict in Ukraine and its impact on the world.
As the war in Ukraine drags on past 100 days, many observers are asking how long the conflict is likely to continue. If one can get a handle on this, it may be possible to get a sense of how long inflation will remain in an unanchored situation, especially with respect to fuel and food prices.
The current situation is playing havoc with financial markets but it has the potential to go much farther than that into the real world of starvation and famine.
In 1939, before he became prime minister, Winston Churchill famously described Russia as “a riddle, wrapped in a mystery, inside an enigma,” and those words spoke eloquently to the western sense of Russia as being altogether different – something else entirely. As the New York Times describes it, an inscrutable and menacing land that plays by its own rules, usually to the detriment of those who choose more open regulations.
That is pretty much the situation today, even though Churchill was referring to the Soviet Union rather than Russia in those days. The current incumbent of the Kremlin, president Vladimir Putin, is a well-known Russian nationalist and shares the same degree of paranoia about Russia being invaded that was common among the Czars as well as the leaders of the Soviet Union. All Russian leaders going back many hundreds of years have had to contend with invasions on many fronts and have all used the same strategy of establishing buffer states to protect the motherland.
In this regard, Putin is no different.
Gateway territories
According to geopolitical economist Peter Zeihan, all of these invasions have occurred through gateway territories – nine gaps that link Russia to the rest of the world. When the Soviet Union collapsed in late 1991, that number had reduced to a single gap. Since then, with various incursions by Russia into areas such as Kazakhstan, Georgia and Crimea, Putin has gradually been filling those gaps by re-taking what he believes to be historical Russian territory, regardless of their sovereign standing in the world.
The current war in Ukraine is part of that process, in order to solidify gains made in 2014 in the east of the country in the Donbas region and in the south in Crimea. At that time, the western powers hardly made any noises at all and Putin must have thought, quite reasonably, that they would be equally acquiescent if he mounted a full-scale invasion of the country.
Putin was also encouraged by the limp-wristed withdrawal of US forces from Afghanistan in August 2021.
But there’s another, demographic reason why Putin had to act on Ukraine when he did. Stalin industrialized the Soviet Union very successfully from the 1930s onwards, but the Lewis Turning Point phenomenon, which results in economic growth suddenly drying up as population growth falters, arrived in Russia decades ago. The movement of cheap labour from the rural areas to the cities dried up long ago, even in the Stalin era. Russia went from having seven children per family in the Stalin era to a figure of around 1.4 today. This has ramifications for the economy in general but for the military especially.
Demographically, this is just about the last time that sufficient people in their twenties and thirties can be relied upon to have a conscription-based military. One must remember that internal military strength is required in a country the size of Russia in order to control such vast swathes of countryside and different ethnic, language and religious groups. Additionally, if Russia was to ever completely overrun Ukraine, it would require a massive army presence inside Ukraine itself to guard against internal sabotage and associated activities.
So, it must have come as no surprise to seasoned Russia-watchers that Putin eventually mounted a full-scale invasion of Ukraine in February this year. His end-game was to overrun the country and install a puppet government in Kyiv.
However, two things have gone badly awry with Putin’s strategy. Firstly, he didn’t reckon on the resistance of the Ukrainians being anywhere near as fierce as it has turned out to be. Secondly, the solidarity of the western powers in applying sanctions against Russia and supplying armaments to Ukraine was a surprise to him. He expected a toughening of sanctions but nothing on the scale that has eventuated.
So, where to from here?
There is no doubt that the Russian military involvement in Ukraine has turned out to be an unmitigated fiasco. Russia has lost thousands of soldiers and equipment in a vexatious campaign that it can only win in a Pyrrhic sense. Had his Ukrainian adventure gone according to plan, he could well have been looking at his next moves, perhaps in Poland, Moldova, Finland or the Baltic States. But those aspirations have now evaporated, at least for the time being. His best hope lies in some sort of negotiated settlement with the Ukrainians and the western powers, but anything that involves secession of territory from Ukraine to Russia will be unacceptable to Ukraine.
That is why a protracted stand-off, with Russia continuing its illegal occupation of Ukrainian territory, appears to be the most logical conclusion.
Until recently, Putin had two weapons at his disposal: energy and food.
The energy part is waning rapidly, as most EU countries with the exception of Hungary have chosen to stop using Russian oil and gas by the end of this year. Even if there are a few cracks in the alliance of countries boycotting Russian energy, the net result will be a severe diminution of energy receipts for the Kremlin.
The other weapon is food in the form of grains, both in Ukraine and Russia itself, little or none of which have been able to be exported from Black Sea ports due to the war. Russia and Ukraine combined produce around 30% of the world’s wheat and much of that is exported via Black Sea ports such as Odessa in Ukraine. Almost all of Ukraine’s wheat is winter wheat, planted in the autumn and harvested from late June through July and August. But Ukraine’s grain silos are largely full and unless this grain can be exported before the wheat harvest begins, there is a very real danger of the wheat rotting in the fields. This would have huge ramifications for hungry people, notably in north Africa, which imports huge volumes of Ukrainian wheat.
Food prices have risen largely exponentially in the past couple of years, due initially to the supply chain disruption caused by the Sars-CoV-2 pandemic but more recently by the war in Ukraine.
If the Ukrainian and Russian wheat cannot be exported soon, and if Ukraine’s winter wheat cannot be fully harvested due to war, then the outlook for global cereal supplies is bleak indeed. According to the US State Department, Ukraine is the world’s fourth-largest exporter of corn and the fifth-largest exporter of wheat.
Some of the most vulnerable and least-developed countries in the world rely heavily on Russian and Ukrainian grains for survival. Additionally, north African countries such as Egypt also import huge quantities of wheat from both countries. We should remember that one of the catalysts behind the Arab Spring uprising in north Africa in 2010 was widespread food shortages.
A possible short-term solution to Ukraine’s grain export problem exists but that involves Ukraine, Russia and Turkey all coming together and allowing Ukrainian exports to leave via the Black Sea port of Odessa. This would require Russia removing its military blockade of the Ukrainian coastline, Ukraine de-mining the waters surrounding Odessa and Turkey allowing free passage of naval escort ships into and out of the Black Sea via the Bosphorous.
A tricky diplomatic exercise if ever there was one!
The US is looking at the possibility of using temporary silos to store the winter wheat harvest and is also examining the possibility of using rail lines to export Ukraine’s wheat. But this would be a desperate measure and would only be attempted if and when widespread famine was becoming a realistic outcome.
