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Tuesday, June 28, 2011

Russian Political, Economic, and Security Issues and U.S. Interests

Jim Nichol, Coordinator
Specialist in Russian and Eurasian Affairs

Russia made some uneven progress in democratization during the 1990s, but according to most observers, this limited progress was reversed after Vladimir Putin rose to power in 1999-2000. During this period, the State Duma (lower legislative chamber) came to be dominated by government-approved parties, and opposition democratic parties were excluded. Putin also abolished gubernatorial elections and established government ownership or control over major media and industries, including the energy sector. The methods used by the Putin government to suppress insurgency in the North Caucasus demonstrated a low regard for the rule of law and scant regard for human rights, according to critics. Dmitriy Medvedev, Vladimir Putin’s chosen successor and long-time protégé, was elected president in March 2008 and immediately designated Putin as prime minister. President Medvedev has continued policies established during the Putin presidency. In August 2008, the Medvedev-Putin “tandem” directed wide-scale military operations against Georgia and unilaterally recognized the independence of Georgia’s separatist South Ossetia and Abkhazia, actions that were censured by most of the international community but which resulted in few, minor, and only temporary international sanctions against Russia.

Russia’s economy began to recover from the Soviet collapse in 1999, led mainly by oil and gas exports, but the decline in oil and gas prices and other aspects of the global economic downturn beginning in 2008 contributed to an 8% drop in gross domestic product in 2009. In 2010-2011, rising world oil prices have bolstered the economy. Russia continues to be challenged by an economy highly dependent on the production of oil, gas, and other natural resources. It is also plagued by an unreformed healthcare system and unhealthy lifestyles; low domestic and foreign investment; and high rates of crime, corruption, capital flight, and unemployment.

Russia’s military has been in turmoil after years of severe force reductions and budget cuts. The armed forces now number about 1.0 million, down from 4.3 million Soviet troops in 1986. Troop readiness, training, morale, and discipline have suffered, and much of the arms industry has become antiquated. Russia’s economic growth during most of the 2000s allowed it to increase defense spending to begin to address these problems, and some high-profile activities were resumed, such as Mediterranean and Atlantic naval deployments and strategic bomber patrols. Stepped-up efforts were launched in late 2007 to further downsize the armed forces to improve their quality. Russia’s 2008-2009 economic downturn, strong opposition among some in the armed forces, mismanagement, and corruption have appeared to slow force modernization efforts.

After the Soviet Union’s collapse, the United States sought a cooperative relationship with Moscow and supplied $17 billion in aid for Russia from FY1992-FY2010 to encourage democracy and market reforms and in particular to prevent the proliferation of weapons of mass destruction (WMD). U.S. aid to reduce the threat posed by WMD proliferation has hovered around $700 million-$900 million per fiscal year, while other foreign aid to Russia has dwindled. In past years, U.S.-Russia tensions on issues such as NATO enlargement and proposed U.S. missile defenses in Eastern Europe were accompanied by some cooperation between the two countries on anti-terrorism and non-proliferation. Russia’s 2008 conflict with Georgia, however, threatened such cooperation. The Obama Administration has worked to “re-set” relations with Russia, which welcomed the Administration’s announcement in September 2009 of the cancellation of the planned deployment of a missile defense system in Poland and the Czech Republic. The Administration has hailed the signing of a new Strategic Arms Reduction Treaty on April 8, 2010, and the approval of new sanctions against Iran by Russia and other members of the U.N. Security Council on June 9 , 2010, as signifying the “re-set” of bilateral relations.

Date of Report: June 13, 2011
Number of Pages: 68
Order Number: RL33407
Price: $29.95

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Friday, June 24, 2011

Serbia: Current Issues and U.S. Policy

Steven Woehrel
Specialist in European Affairs

Serbia faces an important crossroads in its development. It is seeking to integrate into the European Union (EU), but its progress has been hindered by tensions with the United States and many EU countries over the independence of Serbia’s Kosovo province, and, until recently, its failure to transfer indicted war criminals to the International Criminal Tribunal for the Former Yugoslavia (ICTY). However, on May 26, 2011, Serbian security forces captured indicted war criminal Ratko Mladic, who was living in Serbia under an assumed name. He was transferred to the ICTY a few days later.

Serbia’s government is a coalition led by pro-Western forces. The global economic crisis poses serious challenges for Serbia. Painful austerity measures have been required for Serbia to receive loans from the IMF and other international financial institutions. High unemployment and poor living standards (including wage levels that have not kept up with high inflation) could result in the coming to power of forces more skeptical of close ties with the United States and the EU after parliamentary elections are held next spring.

Serbia’s key foreign policy objectives are to secure membership in the European Union and to hinder international recognition of Kosovo’s independence. In December 2009, Serbia submitted an application to join the EU, but the EU delayed a decision on whether to accept Serbia as a membership candidate, in large part due to Serbia’s inability or unwillingness to arrest Mladic. Now that Mladic has been transferred to the ICTY, most observers believe that Serbia has a good chance of achieving EU candidate status in December 2011. However, even if Serbia is accepted as a candidate, many years of negotiations will be required before it can join the EU.

Serbia has vowed to take “all legal and diplomatic measures” to preserve its former province of Kosovo as legally part of Serbia. So far, 76 countries, including the United States and 22 of 27 EU countries, have recognized Kosovo’s independence. Russia, Serbia’s ally on the issue, has used the threat of its Security Council veto to block U.N. membership for Kosovo. After the International Court of Justice ruled in July 2010 that Kosovo’s declaration of independence did not contravene international law, the EU pressured Serbia to hold talks with Kosovo. EUbrokered talks on technical issues began in March 2011, but have so far not produced any agreements.

In December 2006, Serbia joined NATO’s Partnership for Peace (PFP) program. PFP is aimed at helping countries come closer to NATO standards and at promoting their cooperation with NATO. Although it supports NATO membership for its neighbors, Serbia is not seeking NATO membership. This may be due to such factors as memories of NATO’s bombing of Serbia in 1999, U.S. support for Kosovo’s independence, and a desire to maintain close ties with Russia.

U.S.-Serbian relations have improved since the United States recognized Kosovo’s independence in February 2008, when Serbia sharply condemned the U.S. move and demonstrators sacked a portion of the U.S. Embassy in Belgrade. During a May 2009 visit to Belgrade, Vice President Joseph Biden stressed strong U.S. support for close ties with Serbia. He said the countries could “agree to disagree” on Kosovo’s independence. He called on Serbia to transfer the remaining war criminals to the ICTY, promote reform in neighboring Bosnia, and cooperate with international bodies in Kosovo.

Date of Report: June 16, 2011
Number of Pages: 13
Order Number: RS22601
Price: $29.95

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Georgia [Republic]: Recent Developments and U.S. Interests

Jim Nichol
Specialist in Russian and Eurasian Affairs

The small Black Sea-bordering country of Georgia gained its independence at the end of 1991 with the dissolution of the former Soviet Union. The United States had an early interest in its fate, since the well-known former Soviet foreign minister, Eduard Shevardnadze, soon became its leader. Democratic and economic reforms faltered during his rule, however. New prospects for the country emerged after Shevardnadze was ousted in 2003 and the U.S.-educated Mikheil Saakashvili was elected president. Then-U.S. President George W. Bush visited Georgia in 2005, and praised the democratic and economic aims of the Saakashvili government while calling on it to deepen reforms. The August 2008 Russia-Georgia conflict caused much damage to Georgia’s economy and military, as well as contributing to hundreds of casualties and tens of thousands of displaced persons in Georgia. The United States quickly pledged $1 billion in humanitarian and recovery assistance for Georgia. In early 2009, the United States and Georgia signed a Strategic Partnership Charter, which pledged U.S. support for democratization, economic development, and security reforms in Georgia. The Obama Administration has pledged continued U.S. support to uphold Georgia’s sovereignty and territorial integrity.

The United States has been Georgia’s largest bilateral aid donor, budgeting cumulative aid of $2.93 billion in FY1992-FY2009 (all agencies and programs). Georgia has regularly ranked among the top world states in terms of per capita U.S. aid. U.S.-budgeted aid for Georgia in FY2008 was $615 million and $424 million in FY2009, and estimated aid for Georgia in FY2010 was about $171.6 million (all agencies and programs). Planned foreign assistance for FY2011 is about $90 million (country totals for foreign assistance for FY2011 under the continuing resolution, H.R. 1473; P.L. 112-10, signed into law on April 15, 2011, are being finalized). The Administration has requested $87.6 million for foreign assistance for Georgia for FY2012 (data for FY2011 and FY2012 includes “Function 150” programs and excludes Defense and Energy Department funds).

Date of Report: June 15, 2011
Number of Pages: 18
Order Number: 97-727
Price: $29.95

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