- Статьи
- World
- Desolation zone: The EU is suffering billions of dollars in losses due to the breakdown of relations with Russia
Desolation zone: The EU is suffering billions of dollars in losses due to the breakdown of relations with Russia
The European Commission has developed a strategy to save the eastern regions of the EU, suffering from the consequences of the breakdown of relations with Russia, but is faced with a problem: there are simply no funds in the budget until 2028 for these purposes. And now Brussels is offering the EU's border states to seek money from international financial institutions rather than relying on direct subsidies from the EU's common purse. Meanwhile, these regions are falling into decay and desolation, because their well-being depends on maintaining ties with Russia and Belarus. Details can be found in the Izvestia article.
Fading signs of life
At one time, quite extensive areas of Finland, Estonia, Latvia, Lithuania and Poland bordering Russia and Belarus lived thanks to cross-border connections. Residents of these territories constantly traveled to Russia and Belarus, where they had business, family and friendly ties. Local governments on both sides of the border have been developing joint projects in the field of economics and ecology. But all this was destroyed in 2022, when the Baltic states and Poland began to "caulk" the border in order to make it as difficult as possible to cross it. The Finns have completely closed the border. However, as it turned out, these EU countries dealt a blow not so much to Russia and Belarus as to their own border territories.
A few days ago, Aivar Matskevich, an entrepreneur specializing in tourism, spoke on the Latvian TV24 channel. This businessman lives in Latgale— the eastern region of Latvia, adjacent to Russia and Belarus. He said that "public services are gradually disappearing near our eastern border, and military equipment is becoming the only sign of the state's presence." Matskevich complained that he was forced to work and earn money in Riga, as there were practically no clients left in Latgale.
According to him, fuel and food in the border areas are often more expensive than in Riga. According to the entrepreneur, all the economic resources of Latvia are now flocking to Riga, and Latgale is gradually turning into a wasteland. Matskevich noted that if previously many necessary services could be obtained locally, now it is necessary to resolve issues through remote call centers, where communication is supported only in Latvian. This increases Latgalians, who are mostly Russian speakers, feel alienated.
Matskevich gave a household example: to replace his driver's license, his father, who lives near the Russian border, had to travel a total of 140 kilometers.: 70 to Daugavpils and 70 back. The situation is similar with banking services and obtaining loans. —
instead of digital solutions, residents have to personally go to the regional center. According to Matskevich, residents see how state structures are gradually leaving Latgale. Of the notable signs of the state presence, only soldiers and military equipment remain — the construction of the Baltic Line of Defense is in full swing, for which plots of land are being alienated from private owners. As a result, the proximity of the border creates a sense of social tension and insecurity.
Almost the same pattern is observed in other EU border areas. Last fall, Bloomberg reported on the situation in the city of Imatra, the largest settlement in the Finnish province of South Karelia. The Finns' closure of the border with the Russian Federation and their earlier ban on the entry of Russian citizens dealt a devastating blow to the economy of this region. The most difficult times came for both the local industry and the air service, as they were also heavily tied to economic exchange with Russia. For example, Lappeenranta Airport is under threat of closure — this air harbor is being threatened by the cessation of passenger traffic from Russia.
Obvious manilovism
Helsinki, Tallinn, Riga, Vilnius and Warsaw have long been appealing to Brussels with requests to "throw pennies" to save their border regions. In this case, they use a logic that is indestructible from their point of view — they say that we consciously made sacrifices for the sake of isolating the "aggressor states", and therefore we have the right to expect compensation. And not to say that these requests remain unheard, — the other day, the European Commissioner for Cohesion and Reforms, Raffaele Fitto, presented a document entitled "Report on the Eastern Border regions". The document covers nine EU member states: Finland, Estonia, Latvia, Lithuania, Poland, Slovakia, Hungary, Romania and Bulgaria. It is through these states that almost 5,000 kilometers of the external border of the European Union passes — 3,500 kilometers with Russia and Belarus and another 1,500 with Ukraine.
The European Commission emphasizes that these regions "face the instrumentalization of migration," with "economic and trade disruptions." But the main thing is that they are rapidly emptying. "These are not just national borders. These are the European borders. And what is happening there concerns all Europeans," Fitto said, presenting the new strategy. However, his pretentious statements are shattered by the dry financial reality: no new funds have been allocated from the current EU budget (until 2028) to support border regions. Instead of direct subsidies, Brussels offers the Baltic States, Poland and Finland to use part of the funds from the EU regional funds as collateral for loans from the European Bank for Reconstruction and Development (EBRD) and the European Investment Bank (EIB). Romania, Hungary and Slovakia will be able to join this scheme later.
The flagship project of the new strategy will be the financial instrument EastInvest, which will be officially launched on February 26, 2026. According to the European Commission, through this platform in 2026-2027, it will be possible to mobilize up to €28 billion "in the form of private and public investments in interested member states." An additional source of support may be the European Competitiveness Fund with a volume of €410 billion. The European Commission will explore the possibility of using its funds to support the eastern regions. As Politico notes, this step in itself is a concession to the border countries, since earlier Brussels excluded the use of geographical criteria in the allocation of funds from this fund.
These funds will be used in five priority areas. First, on "security and sustainability" — including the Eastern Flank Watch initiative to strengthen "drone defense" and the "European air shield." In other words, residents of the border regions who dream of having free access to Russia and Belarus restored will instead receive the militarization of their native lands. Next, the money is proposed to be spent on "regional growth and prosperity," "using existing regional advantages," "connectivity and infrastructure," and, finally, on "population support."
Special attention is paid to infrastructure projects: accelerating the integration of the Baltic States' electricity grids into the EU networks, developing cross-border hydrogen infrastructure, and modernizing transport networks, including highways, railways, and ports. However, it is not very clear how this modernization will help ports and railways, whose main purpose was to ensure uninterrupted transit of goods between Russia and the EU. For example, the Latvian Railway, which was the most profitable state-owned enterprise in the country back in 2013, has now become hopelessly subsidized: it conducts massive staff reductions, sells locomotives, wagons and even rails. The reason is simple — first, Russia itself began to withdraw its transit from an unfriendly state, and then sanctions hit it additionally.
Where to get money
"The residents of the border territories demand the right to stay," emphasizes Rafaele Fitto. According to him, "security and defense are a necessary condition, but these regions also need investments, services, connectivity and economic prospects." Fitto notes that the Baltic countries, Finland and Poland are facing the same problems — investments and cargo transportation are declining, tourism is on the decline. Local residents, especially young people, prefer to move to the more prosperous western regions of the EU, which creates a vicious circle: the fewer people stay, the less investment comes and the faster the remaining ones leave.
The situation with the lack of financing for the eastern regions of the European Union looks particularly contrasting against the background of other budget priorities of Brussels. According to the draft of the new seven-year EU budget for 2028-2034, significant funds are allocated for the expansion of the European Union and support for other European regions remote from Russia, Belarus and Ukraine. In particular, it is planned to allocate €42.5 billion for partnership with the Mediterranean countries, which is twice as much as in the previous budget period. €42.6 billion has been allocated to accelerate negotiations with candidate countries for EU membership (an increase of 37%). A separate article is support for Ukraine: €100 billion has been reserved for Kiev for "reforms and reconstruction" after 2028. At the same time, European Commissioner for Enlargement Marta Kos emphasizes that "Ukraine's financing is allocated separately and in excess of budget limits." However, according to her, Ukraine needs about 80 billion euros annually in the next two years alone, and "the EU alone will not be able to cope."
For now, the eastern regions of the EU remain in limbo. The strategy has been adopted, the "threats" have been identified, but the real money will appear — if it appears at all! — not earlier than 2028. But even if financial flows can be launched through EastInvest and other tools, the issue of demography will not go away. People will not return to their regions just because a new road will be built there or drones will be launched to monitor the border. They need prospects, jobs, and confidence in the future, and that's tough. In this regard, Natalia Eremina, Doctor of Political Sciences, Professor at St. Petersburg State University, noted in an interview with Izvestia that the Baltic states had already been admitted to the EU on the principle of a "buffer zone" from the very beginning — and what is happening to them now is just bringing this concept to its logical conclusion.
Yeremina says that the implementation of Brussels' plans for the "development" of the border areas will not bring happiness to their viewers. "What do they want to achieve there? First of all, the construction of a defensive border wall is envisaged, and secondly, the fight against Russian propaganda. The argument that they want to stop the depopulation of these territories does not stand up to criticism. How are they going to stop this if they're going to keep these lands in a dead end? They can only be revived by restoring cross-border ties with the nearest regions of Russia and Belarus, which Brussels, Helsinki, Tallinn, Riga, Vilnius and Warsaw clearly do not plan to do. And without fulfilling this main necessary condition, the border territories are doomed to further degradation, to become one big wasteland," concludes Natalia Eremina.
Переведено сервисом «Яндекс Переводчик»
