Economic background of Russia and its effects on foreign politics : is Nato-Finland expecting consequences?

Abstract

To determine how and why Russia is using trade politics as an instrument for political influence, it is necessary to explore the background of Russian economy and its history. Also the basics of trade politics and international trade are surveyed. The case study is to analyse whether it is expected in Finland that Russia reacts with economic means if Finland joins NATO. The data to study consequences was gathered from the newspaper Helsingin Sanomat published between years 2001–2012.

Russia’s foreign politics’ cornerstone seems to be safeguard energy transfer from Russia to European consumers. The main political target is to be an autonomous and independent entity. Russia does not follow predetermined trade politics but politics is applied, as appropriate, to achieve a more important goal of independence and sovereignty.

The biggest challenge for Russian economy is one-sided, energy-based export structure. It does not have significant flow of capital or technology, rather than domestic know-how or industrial ability for competition. For this reason, Russians aim towards protecting industry by using duty and tariffs, as well as legislation and bureaucracy.

Russia is trying to define itself through opponents and to be able to show itself as a superpower it needs a superpower to be the enemy, ergo NATO. Finland's membership in NATO would likely undermine Russian confidence towards Finland. Instead, a longer-term economic response is not in prospect. In Finland there are expectations of Russian reaction but it is difficult to predict what Russia would benefit for using economic means towards Finland.