Emerging Europe Winter 2019-20

Winter 2019-20 Deconstructing Poland's election Mercosur deal impact emerging Europe?

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emerging-europe.com Doing Business in Armenia How does the EU’s Why Yugoslavia's Black Wave is still relevant

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INBRIEF Cities of Opportunity 2019, which looked at 75 cities around the world renowned for their entrepreneurial spirit, business opportunities and economic growth.

Poland’s ruling Law and Justice party (PiS) won a parliamentary election, taking an overall majority in the lower house of the Sejm, the country’s parliament. However, PiS narrowly lost its majority in the senate, which will make it more difficult for the party to pass legislation.

The Vienna Institute for International Economic Studies (wiiw) warned that while much of Central, East and Southeast Europe has so far weathered the slowdown in the global economy well, signs of contagion are starting to emerge.

Countries with particularly high degrees of exposure to Germany and/or where the automotive sector plays a large role in manufacturing – including the Visegrád countries, Romania, North Macedonia and Serbia – are particularly vulnerable.

For 2020-2021 the Vienna Institute forecasts average regional growth of 2.9 per cent.

Lilyana Pavlova has been appointed as the new vice president of the European Investment Bank (EIB). She is the first Bulgarian to join the EU bank’s management committee. A doctor of economics, Mrs Pavlova was appointed by the EIB’s board of governors at the proposal of the Bulgarian finance minister and with the agreement of EIB shareholders Bulgaria, Croatia, Cyprus, the Czech Republic, Hungary, Malta, Poland, Slovakia and Slovenia. She succeeds Vazil Hudák, whose mandate as vice president ended at the end of October.

Romania’s parliament voted to approve a new cabinet led by Ludovic Orban, the leader of the Liberal party (PNL). Romania’s president, Klaus Iohannis (who was himself reelected in November's presidential vote), nominated Mr Orban to form a government following the defeat of the administration of Viorica Dăncilă in a no-confidence motion.

The leaders of Albania, North Macedonia, and Serbia declared that they would implement a miniSchengen zone, and expect all six Western Balkan countries to join soon. The leaders declared that the region would cover the four freedoms that Schengen includes – free movement of goods, capital, services and people. Exact details of how open the border will work have yet to be fleshed out.

Economic Forum in Shanghai, Hungarian Foreign Affairs and Trade Minister Péter Szijjártó said that Huawei would build the network in cooperation with British mobile operator Vodafone and Germany’s Deutsche Telekom.

Central European Media Enterprises (CME), which operates some of the most popular TV channels in Central and Eastern Europe, including ProTV in Romania and bTV in Bulgaria, announced that it was set to be acquired by an affiliate of the Czech PPF Group in a cash transaction valued at approximately 2.1 billion US dollars. Earlier this year, PPF, whose majority shareholder is the Czech billionaire Petr Kellner, pulled out of a deal to buy Bulgaria’s Nova Broadcasting Group from Sweden’s MTG. Polish exports of games, consoles and video game devices increased by an astonishing 3,810.5 per cent in the five-year period from 201318, making the country the fourth largest video game exporter in the world, behind only China, Hong Kong and Japan. According to Polish bank PKO BP, the value of exports reached 1.24 billion euros in 2018, 6.5 per cent of the global total.

SmartBrain.io, a marketplace for top IT contractors, revealed that the average cost of developing a mobile app in Eastern Europe is 23,000 US dollars, compared to 171,450 US dollars in the US. SmartBrain.io analysed data from more than 400 deals between Eastern European contractors and Tallinn has been rated as the international start-ups and found best city in emerging Europe for Chinese telecommunications that developing a new app in Poland, entrepreneurs in a new report published by Movinga, a provider of giant Huawei announced that it will Romania, Ukraine, or other Eastern cooperate with Hungary in building European countries requires, on relocation services. the country’s 5G network. Speaking average, 7.4 times less capital than The Estonian capital was at the Hongqiao International doing the same in North America. ranked 29th globally in the report,

PUBLISHED BY Emerging Europe Limited HubHub 1 St. Katherine's Way London EC4A 4AB, United Kingdom T +44 20 3808 8558 W emerging-europe.com E newsroom@emerging-europe.com Founding Partner, Strategy & Content Andrew Wrobel andrew@emerging-europe.com Editor Craig Turp craig@emerging-europe.com Editorial team Claudia Patricolo claudia@emerging-europe.com Dominik Istrate dominik@emerging-europe.com Jerry Cameron jerry@emerging-europe.com Portia Kentish portia@emerging-europe.com Contributors Juliette Bretan Linas Jegelevičius Frédéric Schneider Nikodem Chinowski Jerry Cameron Graphic Designer Karolina Antipenko

FROM THE EDITOR No matter where in emerging Europe you live, the chances are high that life has never been better.

There are still many problems, not least unresolved conflicts in Ukraine, Georgia, Armenia and Azerbaijan, there are still large pockets of poverty and destitution, but for the vast majority of the region’s population, life is immeasurably better than it ever has been.

As the 30th anniversary of the emerging Europe’s year of revolutions draws to a close, we have looked at the quality of life across the region to try and grab a snapshot of the capital cities that have done best since 1989, as well as those which still have much work to do.

Prague, in the Czech Republic, tops the list, closely followed by Tallinn in Estonia. Both cities offer a standard of living higher than many places that did not spend half the century behind the Iron Curtain.

But even at the other end of the scale, in Kyiv, the Ukrainian capital, life is better than ever

Cover Miroslav Lukič Video Editor Piotr Dobroniak Photographer Sabrina Bouchaala Partner, Growth & Partnership Emiliano Ramos emiliano@emerging-europe.com Managing Director Mariam Rachi mariam@emerging-europe.com

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Craig Turp, Editor

before. There is also – and this is perhaps the key factor – a genuine sense of hope that things will continue to improve.

No transition is easy, and it is clear from the results of our study that some places have transitioned from a planned to a market economy better than others. What’s crucial is that the political will to bring about positive change for all remains the driving force both for local and national governments, as well as for international institutions with a stake in the region.

The recent failure of the European Union to begin accession talks with Albania and North Macedonia, despite both countries having done all that was asked of them, was a huge setback in this regard. There must not be any more.

Countries in the eastern part of Europe rejected by the West may be forced to look in another direction.

That could lead to 30 years of hard work counting for nothing.

It’s time for all of Europe – east, west, south and north - to truly unite. •

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The views expressed in all opinion editorials published in this special report are the authors’ own and do not necessarily reflect Emerging Europe’s editorial policy.

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Photographs: BigStockPhoto.com unless stated otherwise.

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Food for thought

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Shorts, Notes & Quotes

20 34 Emerging politicians: Irena Joveva and Uldis Budriķis

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‘Nord Stream 2 is in conflict with several of our common European goals’ Rebecca Harms, a former German member of the European Parliament for the European Greens, speaks to Emerging Europe about Nord Stream 2, its political implications within the European Union and what the pipeline means for the continent’s energy security.

CURRENT AFFAIRS

14 A view from: Washington and Paris

Table of contents

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Deconstructing Poland's election On October 13, 18.6 million Poles – a record since 1989 – cast their votes in a parliamentary election, possibly the most important political event in the country'srecent history. The results were fairly unsurprising, with the ruling Law and Justice party (PiS) securing a clear victory in the Sejm.

The jury is out on Ukraine’s new leaders The new Ukrainian government has outlined an ambitious agenda for the country’s future.

Armenia is actively working to better position itself on the investment map by creating a more attractive business climate. Foreign investment will be crucial for maintaining the economy’s so-far robust growth rate.

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The nuclear option No matter how many emission targets we put on ourselves, the quantity of carbon dioxide in the atmosphere keeps growing.

While some governments are looking at natural gas as a potential bridge to a sustainable future, many emerging Europe countries are instead focusing on nuclear to both reach the emission targets and diversify their energy supplies.

38 BUSINESS

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Tunnel vision A tunnel linking Tallinn with Helsinki may no longer be a pipe dream, but obstacles to the ambitious project remain.

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Armenia’s economic reforms pave the way for more investment

Capital Living 2020: What makes Prague and Tallinn the best places in emerging Europe to live?

Emerging Europe crunched the numbers to find out which of the 23 capitals of the region offers its citizens the highest quality of living.

How does the EU’s Mercosur deal impact emerging Europe?

After 20 years of negotiations, the European Union has reached an agreement with the Mercosur states (Argentina, Brazil, Paraguay and Uruguay) for a more comprehensive trade deal.

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With the economies of emerging Europe increasingly dominated by innovation and technology, we take a look at 10 of the region's most promising and disruptive start-ups.

Skiing in emerging Europe is not always perfect, and is rarely hassle-free, but these 10 resorts all have plenty to offer, usually at a fraction of the cost of their counterparts in Western Europe .

10 EE start-ups to watch in 2020

Emerging Europe’s top 10 ski resorts

54 LIFESTYLE

Holidays behind the Iron Curtain

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On a 1989 trip to the Bulgarian ski resort of Borovets, Emerging Europe editor Craig Turp bought a large hotel's entire stock of Pepsi. It made him realise that a planned economy could never work.

Exhibition, Books

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Life in Russianoccupied Crimea: What's changed?

Citizens across the Crimean peninsula, regardless of nationality and ideology, are trying to cope with the everyday struggles of life in a difficult environment that desperately needs to improve.

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A postcard from the Romania-Bulgaria border

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Kyiv vs. Kiev is not a fixture in the Ukrainian Premier League

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Going vegan in Budapest

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FOOD

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THOUGHT digital transformation, inclusive growth, and the role of Europe in a global market facing increased protectionism.

Policymakers and business leaders in Central and Eastern Europe would do well to reflect on these four issues and begin planning their strategies for the new EC agenda.

The fi rst issue is environmental protection, an area to which Ms von der Leyen dedicated a large part of her speech. Th is reflects an adjustment of priorities in reaction to the new balance of power within the European Parliament. Instead of two major factions in this institution, there are now four, including the Greens.

That is why emphasis is put on sustainable development and green transformation.

The programme set out by Photo: Agnieszka Gajewska Ms von der Leyen is still rather general, but already some concrete proposals have emerged. She has said that she would enact the fi rst European climate law. Th is would Agnieszka Gajewska, PwC Public Sector & Infrastructure Industry formalise Europe’s declaration Leader Central and Eastern Europe. that it will become carbon neutral by 2050, an ambitious plan that In a speech before the European will involve major investments Parliament in mid-July of this and changes in our day-toyear, the president-elect of the day operations. The targets on European Commission Ursula von reduction of CO2 emissions by the der Leyen indicated that four key year 2030 from 1990 levels would be issues will be in focus for the new 50 per cent – or even 55 per cent – Commission in the months and and not the 40 per cent reduction in years to come: the environment, the existing plan. A large portion of

The new European Commission agenda: Implications for CEE

EC funded investment projects will therefore be focused on reducing greenhouse gas emissions and the structure of expenditure from the EU budget will have to be changed.

The incoming president says that a quarter of the EU budget for 2021–2027 will be earmarked for sustainable development.

The European Fund for Sustainable Development (EFSD) will gain importance, with a budget of one trillion euros to be invested in the coming 10 years to support research and innovation in Europe's green transformation. Ms von der Leyen also wants a part of the European Investment Bank, which plays a major role in Central and Eastern Europe, to be transformed into a European Green Bank. Preparations for this are already underway and will have an impact on the way projects are funded in our region.

Th is is causing some concerns and potential stress to EU cohesion.

Ms von der Leyen has repeatedly emphasised that EU cohesion is still very important for her. Even if the funds dedicated specifically to cohesion are smaller, the money for this purpose will be available in other funds. Understandably, some EU member states in CEE are concerned that there will be less money in the EU budget in national envelopes and more in all-Europe envelopes for specific purposes like sustainability initiatives. Companies

and public institutions in our region will have to compete with entities from other EU countries. This does not mean, however, that our starting position is worse. On the contrary, I would venture the opinion that, because of how much we have to do in the area of environmental protection, we can find it easier to apply for projects with the most positive environmental impact.

In light of this, the way of thinking about investment projects in our region will also have to change. The incoming president talks a lot about a Just Transition Fund. The budget of the fund will be relatively small, around six billion euros, but the money will go primarily to helping the regions cope with the social consequences of green transformation. With a heavy reliance on coal, Poland and other similar countries in CEE can be a major beneficiary of all the essential funding instruments, including the European Fund for Sustainable Development.

Central and Eastern Europe also stands to benefit from activities within the major focus of Ms von der Leyen’s agenda: the digital revolution. This has already been a big area of interest for the EC, but the new president has indicated that she will put even more attention, and even more investment, into dealing with the impact on our economies and societies of digitisation, automation, artificial intelligence and the like.

Ms von der Leyen has indicated that on balance she sees the digital revolution as a potential opportunity, provided that certain social problems are addressed.

In striving to maximise the positive effects of the changes and to minimise the negative ones, the EC’s most important instrument will be the Digital Europe programme, which amounts to 9.2 billion euros.

This money will be used primarily to support innovative small and medium-sized companies that often find it difficult to access capital, and also to improve people's skills.

As in the case of green transformation, there is much to be done on digital transformation within most CEE countries. At the same time, it seems that companies and workers in our region see digitisation more as an opportunity

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than a threat – and are focused on acquiring the skills to take full advantage.

In this year’s edition of the PwC Global CEO Survey, 89 per cent of business leaders in Central and Eastern Europe told us that their top challenge is the availability of key skills for the digital age. Globally, this challenge is third in the list of business leaders’ concerns. This can be understood to mean that while companies in our region struggle to find or retain personnel with the right skills, they are acutely aware of the importance of doing so. They should be active in the uptake of investment upskilling opportunities provided within the new EC agenda. Interestingly, in a recent PwC Global Skills Survey, which featured Poland as one of the countries in the global sample, 63 per cent of Polish workers said they believe that automation brings more opportunities than threats.

Worldwide, this figure was only 50 per cent – showing an openness to embracing the digital revolution.

The third issue laid out by Ms von der Leyen as part of her agenda is inclusive growth. So far, the promotion of inclusive growth at the EU level consisted of striving to level out the differences in living conditions in all regions.

With regard to income inequality within EU members states, Ursula von der Leyen talks, among other things, about the need for better enforcement of taxes on transnational companies operating in Europe. Income inequality is a problem that has grown in the age of digital transformation, and one

for which Ms von der Leyen wants to find a mutually agreed solution.

Under the new EC president, the inclusive growth agenda will be understood more broadly. In her speech, the incoming EC president indicated various social groups will require further support, including the young, the elderly, immigrants and women. It is worth noting that in Ursula von der Leyen’s Commission, half of the members are to be women, while to date women have only constituted 20 per cent of the commissioners.

The fourth and final issue that Ms von der Leyen set out in her speech is the role of Europe in the global market, in the face of growing protectionism around the world.

Europe must find its own path towards cooperation with other regions and has the ambition to conduct international dialogue in the spirit of multilateralism rather than isolationism. Ms von der Leyen believes that this requires more cohesion within the EU itself.

The question before us is how successfully member states we will be able to work together on this agenda set out by the incoming EC president, but overall it is a positive step that Ms Leyen has accurately identified four important problems that none of the member states will be able to solve on its own.

Ultimately, policymakers in CEE would do well to examine ways of more effectively partnering with like-minded partner institutions in order to solve these important problems for the benefit of their citizens. •

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Shorts, Notes & Quotes "If the people of Belarus want to kick me out of office, they will have the chance to do so next year."

Belarus President Aleksander Lukashenko, speaking after parliamentary elections in which no opposition parties won seats.

“Forests give us energy, strength and peace. To cut down a tree is to cut down a human soul.”

Romanian witch Irina Primavera, the face of a new Greenpeace campaign to raise awareness about the loss of Europe's last primaeval forest.

"People in the Balkans have had terrible governments. Thirty years have passed, an entire generation that endured rough times and I blame the leaders that governed them. They deserve stability and prosperity.”

Entrepreneurs rank Tallinn as emerging Europe’s leading start-up hub Entrepreneurs across Europe now rank Tallinn as one of the continent’s leading start-up hubs.

In its latest report looking the development of start-up ecosystems and founder mobility in Europe, Startup Heatmap Europe reveals that the Estonian capital now ranks ninth amongst start-up founders in Europe who were asked the question: “Where would you set up your company if you could start again tomorrow?”

The Polish capital Warsaw, in 17th place, is the only other city from the emerging Europe region to make the top 20.

However, some cities in the region do perform well in a number of sub-categories.

Founders rate Cluj-Napoca in Romania as Europe’s top spot for talent availability, while Kyiv

in Ukraine and Ljubljana in Slovenia make the top three for value for money.

The report also reveals that Central and Southeastern Europe is losing start-ups at a higher rate that it attracts them, mainly to the UK and Ireland. The Baltics however have seen growth in the number of startups setting up in Estonia and Lithuania, often attracting entrepreneurs from the Nordic countries.

In terms of funding, the report reveals that start-ups in the Hungarian capital Budapest attracted 670 million euros of investment in 2018, the highest amount for any city in the emerging Europe region. •

Professor Robert C. Austin talking about his new book, Making and Remaking the Balkans: Nations and States Since 1878.

Tech fund launched to support Armenian entrepreneurs Aybuben Ventures has launched the first venture capital fund primarily dedicated to Armenian tech entrepreneurs around the world. The initial value of the fund is set to be 50 million US dollars.

The average deal size is expected to be between 500,000 US dollars and three million US dollars, with Aybuben Ventures targeting a capital share of five to 25 per cent.

Alexander Smbatyan, founding partner, Aybuben Ventures, said: “Our mission is to support Armenian entrepreneurs in the most rapidly growing tech industries with a core focus on artificial intelligence, machine learning and virtual reality.”

“We see our mission as follows: 10 million Armenians live around the world. Hundreds of thousands are infused with entrepreneurial spirit and the will to create and develop new and exciting developments. We want to partner with at least 1,000 of these entrepreneurs to launch tech companies that will make a difference within the coming five years,” added Alexandr Yesayan, another of Aybuben’s founding partners.

Arman Vardanyan, CEO of C-Quadrat Ampega Asset Management Armenia, said: “IT is one of the most successful and fastest growing industries in Armenia and many people are leveraging great potential in this area.

Making Armenia an IT hub, building links between the disruptive tech businesses and the capital market is a forward looking initiative of Aybuben Ventures. It will help to keep talent in the country, cultivate great ideas and build on the potential that Armenia has.” •

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“Just don’t let yourself get executed.”

Poland now world’s fourth largest exporter of video games Polish exports of games, consoles and video game devices increased by an astonishing 3,810.5 per cent in the fi ve-year period from 2013-18, making the country the fourth largest video game exporter in the world, behind only China, Hong Kong and Japan.

According to the Polish bank PKO BP, the value of exports reached 1.24 billion euros in 2018, 6.5 per cent of the global total.

One of the main reasons for the huge increase is the success of The Witcher action role-playing game developed by CD Projekt Red and based on based on the novel series of the same name by Polish author Andrzej Sapkowski.

The entire Witcher series has sold 40 million units since the fi rst game launched in 2007.

In June of this year, CD Projekt Red confi rmed that the The Witcher 3: Wild Hunt has passed 20 million in sales.

A television series based on the novels, produced by Netfl ix, is scheduled to be released later in 2019. •

Miklós Németh, Hungary’s last communist prime minister, recalls the advice his father gave him on hearing that he was set to be appointed prime minister in 1988.

“Open society is not an empty slogan for us.

We’ve had to fight for it.”

Central European University president and rector Michael Ignatieff, marking the official inauguration of the university’s new home in Vienna.

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Current Affairs

A Climate Union or a Treaty for Renewables and Efficiency is the positive future project the time is right for, says Rebecca Harms, a former German member of the European Parliament for the European Greens. Read the full interview on pages 22-23

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A VIEW FROM...

Washington

The US Visa Waiver Programme (VWP) is an important diplomatic tool to improve security and economic interaction on both sides of the Atlantic, strengthening US bonds with crucial allies in Europe.

In a long-waited welcome development, on November 11 Poland became the 39th country Anthony Kim, Research Manager to be added to the VWP. Citizens and the Editor and nationals of Poland are now of the Index of eligible to apply for the waiver using Economic Freedom, There is no description.

The Heritage the Electronic System for Travel Foundation.

Authorisation — more commonly referred to as ESTA — enabling them to visit the US for tourism or business purposes for up to 90 days without obtaining a visa.

In addition to enhancing trade, travel, and diplomatic ties between America and its allies, the VWP has been considered as the “gold standard” in international

counterterrorism cooperation requiring key intelligence sharing from participating countries Indeed, such information lies at the core of a credible vett ing programme. Without good information and surety regarding the identity of persons entering the US, no vett ing system can hope to match the expectations of policymakers and the public.

The VWP also helps to ensure that passport-control practices are secure. It requires that countries in the programme issue secure, machine-readable, microchipped passports to their citizens. By containing a chip with the biometric data of the person travelling, these passports are harder to forge or manipulate. Furthermore, the VWP requires participating countries to share information on lost and

stolen passports, a second barrier to fraudulent passport use.

As the US has welcomed Poland to the VWP, where appropriate in the future, it merits to consider seeking ways to include additional allies in the region in the VWP. While many NATO member states already take part in the programme, some other allies in Europe who would like to join have been unable to, due to high visa-refusal rates.

As Washington and Brussels celebrated 70 years of NATO in April this year, it would be wise to improve and expand programmes that increase common economic and security interests. The Visa Waiver Programme is one of those, and it should be judiciously expanded to enhance the ties and deepen trust between nations.

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Paris

Thibault Muzergues Europe Programme Director at the International Republican Institute

Six months ago, my View From Paris described how France was stepping up its diplomatic game in Central Europe: Paris was in need of new allies in Europe, and countries like Slovakia or Romania (among others) seemed excellent starting points for France, which will be the uncontested second biggest power in the EU after Brexit, to regain some influence in the region.

Th is fl irting (at least in its original form) didn’t last long. Not that French diplomats in Bratislava, Warsaw or Bucharest are not trying very hard to enhance the relationship in emerging Europe’s capitals. But the Château, where Emmanuel Macron sits, has engineered another French foreign policy U-turn, resulting in a rapprochement with Russia that is bound to change the relationship with individual countries in the region.

The reasons for this change of heart are many, and include a postYellow Vest movement trauma, but movement linked with the president’s recent international frustrations: France’s relationship with Germany has turned sour

as Macron’s proposals to renew Europe have all been politely rejected by Angela Merkel, while his strategy of creating an entirely new political grouping subservient to him has failed miserably, leaving the French president isolated on the European stage, and humiliated as his first pick for European Commissioner was rejected, mostly for political reasons.

In the meantime, Macron’s strategy with the United States, consisting principally in building a strong personal relationship with President Donald Trump, has not led to any results for France: the United States are not jumping back in the brain-dead Paris Climate agreement, nor did Trump agree to talk to the Iranians after Macron’s coup d’éclat in Biarritz.

Th is explains why the French president is changing strategy – to try and get a stronger footing in world politics, this time by playing the unilateral card at EU level (making France a selfi sh rogue, much in Gaullian style) and talking to different actors.

Russia is currently giving him this opportunity, and Macron’s behaviour (including his rant about NATO) are following this pattern to give in to Russia in order to regain the initiative on the European stage. Th is is not new – before him, Jacques Chirac and Nicolas Sarkozy tried to “reset” relations with Russia. In the shortterm, this renewed attempt might lead to some “success”, as the Minsk process will probably be restarted in the near future, and some surprising rapprochements (notably with Viktor Orbán, the prime beneficiary of France’s U-turn). But in the long-term, the strategy is suicidal: it weakens Euro-Atlantic structures, while many a government in Emerging Europe will conclude that the French are indeed not to be trusted when it comes to European security.

The Russian mania will probably pass, as Macron will soon have to realise that the current strategy is leading him nowhere. But much damage will have been done in the meantime, in emerging Europe as elsewhere.

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Deconstructing Poland's election On October 13, 18.6 million Poles – a record since 1989 – cast their votes in a parliamentary election, possibly the most important political event in the country's recent history. At first glance, the results were fairly unsurprising, with the ruling Law and Justice party (PiS) securing a clear victory in the Sejm.

However, closer inspection reveals key shifts in the country’s political climate, something which is not only pertinent for Poland, but for the region as a whole.

Now that the dust has settled, it’s time to take a deeper look at what these results mean for the country’s future.

WORDS PORTIA KENTISH

a credible alternative and relied too much on simply not being PiS. This was poignantly illustrated when an opposition MP was unable to name his party’s five-point policy plan live on national radio.

Even when KO did successfully make promises, they weren’t necessarily received well. Unlike PiS, when promising social spending reforms, they suffered from a lack of credibility as during their eight years in power before 2015 they arguably failed to implement the same degree of spending as their rivals. It also doesn’t help that the main opposition leader, Grzegorz Schetyna, is not well liked amongst voters. However, the nomination s polls predicted, PiS suggests, this “redistribution of secured 44 per cent of prestige” allowed many Poles to feel of popular Malgorzata KidawaBlonska as KO’s candidate for the vote in the Sejm, as if they were not missing out on PM did manage to detract some winning 235 seats, unchanged the current economic success, as from the 2015 election. Speaking finally they had a government which attention away from Mr Schetyna at roundtable discussion dedicated “didn’t treat [PiS voters] as country during the campaign. to analysing the election, held in hicks and a basket of deplorables Why the opposition lost London in October and organised unlike the urban elites that had

by UCL’s School of Slavonic and come before them.”

However, the opposition did not East European Studies (SSEES), It seems that despite the party’s do terribly. While they weren’t able Professor Aleks Szczerbiak of the many encounters with political to grab control in the lower house of University of Sussex said that for scandal and controversial judicial parliament, they won a higher than PiS, winning an overall majority reforms, the public cut the party expected 27 per cent of the vote, was an “incredible achievement”. some slack in exchange for and more importantly turned the One of the main reasons for the economic and social benefits. tables in the senate. While PiS took PiS victory was the party’s highFurthermore, some analysts even profile social spending policies. suggest that, while far from perfect, the most seats, 48, it does not have The party has been able to deliver their attempt to reform a somewhat a majority: KO won 43, the Polish Coalition (PSL) three and the Left on policies that many Poles really broken judiciary system may have Alliance (Lewica) two. Independent cared about, such as a generous won voter support. candidates won four seats. child benefit scheme, tax cuts, Another reason for their success Consequently, the opposition pension increases and raising was the weakness of the main was able to name the speaker of the minimum wage. Under what PiS opposition parties, notably Civic the senate, giving it a platform to leader Jarowsław Kaczyński calls Coalition (KO). Many analysts, delay or amend legislation and the Polish version of the welfare such as Jakub Krupa, the former state, the party has been able to London correspondent of the Polish appoint members of investigative committees. These senate results appeal to people’s pockets, and Press Agency (PAP) argued that mean that the political forces are with great success. As Szczerbiak the opposition failed to provide

A

rather balanced between the lower house and the senate – a result many Poles may be satisfied with.

This balance creates a power check which PiS did not have previously and could cause problems if they try to rush legislation through.

However, if the opposition overplays its hand this could work against it, as striking down legislation and causing political gridlock never plays particularly well with voters.

Nevertheless, it is important to note that just because PiS has lost control of the senate, it does not mean the opposition has gained it. The four independents hold the balance of power and time will tell how this plays out. To maintain a solid hold on power however the government has a lot of work to do, not least as some of the party’s MPs are rumoured to have a fractious relationship with the prime minister, Mateusz Morawiecki.

However, for all members of the opposition to come together against PiS in a vote is also unlikely. As a result, many close votes and political gridlock can be expected.

The media’s role As democratic-watchdog bodies such as Freedom House and the OSCE have noted, PiS benefitted from unbalanced media support in the lead up to the election. Since 2015, state controlled media have shifted their advertising to private media that support the government.

Most notably, Gazeta Polska has become an increasingly vociferous mouthpiece for the party, with its revenue rising 70 per cent in 2016 despite a fall in sales. Moreover, foreign-owned independent media has faced some regulatory pressure from the government and is labelled as foreign interference for its negative coverage of the government’s agenda.

It is unclear the exact role this combined media reach had in swaying voter opinion, but it is undeniable it gave PiS a big advantage, especially since many Poles mainly watch public stateTV networks. However, this is not to say that the opposition did not experience coverage and support from more centrist and left-leaning

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CURRENT AFFAIRS

media networks; it just was not as mainstream.

and more importantly, it is telling of the country’s increasing political polarisation, which is often a driving Extremism on the rise factor of voter mobilisation.

This polarisation is further In conjunction with the regional echoed in the upturn in support for political narrative, extremist parties extremist parties. This increased in Poland gained an unexpected participation is not only clear amount of support. The far-right in voting patterns but in the rise of Confederation party gained political demonstrations and rallies. a sizeable 11 seats, up from six in the One example that comes to mind 2015 elections. The party was able to is the recent LGBT pride march capitalise on nationalist tendencies in Bialystok where protesters were with anti-immigrant rhetoric attacked by anti-LGBT counterand criticising PiS for not being protesters, exemplifying the internationally assertive, particularly heightened polarisation. As Dr Anna in the case of US-Poland relations.

Gwiazda from Kings College Having a party on the right of London suggests, before 2015 the PiS could cause it problems, as Poles were passive democrats, but Confederation is likely to call out since PiS came to power, they are PiS for being too conciliatory on becoming more and more active. issues such as immigration, abortion The political sphere is becoming law and minority rights, potentially more polarised, mobilised and scraping off some PiS voters. Their extreme. PiS’s turbulent first term increase in power may also shift the has been characterised by scandals, political rhetoric to the right, giving battles with the EU and antiair to opinions that are usually on minority rhetoric. However, they the periphery of politics in Poland. have also enjoyed support from Confederation’s new found influence those who have benefited from social could not only compund these spending, a growing economy and issues, but shift the political agenda popular cultural policies. even further to the right.

The next few years will be crucial in determining the broader A record turnout direction the country chooses to take. The next thing to look out for A record 62 per cent of Poles is the presidential election next year. turned out to vote in the election, While incumbent Andrzej Duda the highest since the fall of currently enjoys popular support, communism in 1989. This high a lot could change. New candidates level of political participation can will appear and the return of Donald be interpreted in a number of ways.

Tusk to frontline Polish politics Firstly, it highlights the political should not be ruled out. This year’s parties’ success at mobilising parliamentary election may well voters, and the importance of this have been merely the warm-up act. consequential election. Secondly, More is yet to come. Stay tuned. •

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The jury is out on Ukraine’s new leaders The new Ukrainian government has outlined an ambitious agenda for the country’s future. With expectations high, much will depend on whether the new Ukrainian leadership will be able to fix the economy, move closer to Europe and bring an end to the Donbas war.

WORDS DOMINIK ISTRATE

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uch is at stake for Ukraine’s new leadership.

After Volodymyr Zelensky’s decisive win in a presidential election earlier this year, his Servant of the People party became the first political formation ever to win a majority in the Verkhovna Rada, Ukraine’s parliament, during snap elections in July. Only into a few months in the job, both Mr Zelensky and Oleksiy Honcharuk, the country’s youngest ever prime minister, are expected to deliver: they will have to do soon to keep the support of the public whose optimism, however, has been decreasing over the past few months.

The latest polls suggests that 37.5 per cent of the population believe the country is going in the right direction, down from 57 per cent in September and 45 per cent in October, while those thinking the country is going in the wrong direction has climbed to 35 per cent.

Opinion polls also show that the issue of the Donbas war, as

achieving a minimum monthly salary of 174 US dollars is also among the government’s goals.

“While we have a conflict in the eastern part of Ukraine and high military expenditure, it will be difficult to combine and achieve these goals,” Mr Kyian tells Emerging Europe, noting that as a consequence, we should expect a mix of market-oriented and society-oriented policies.

“Reforming the energy sector, opening the land market, the gambling business, privatisation and other reforms can facilitate the pro-market agenda. However, these policies may pose some risk of losing control over the situation,” he continues, noting that in some cases - such as energy reform - Ukraine will need the support of the EU well as rising prices, inflation and and other international partners. corruption are the top concerns for “Without their support, we all may Ukrainians, which make it clear fail,” he adds. which areas should be prioritised One example of such support by both the president and is the country’s next cooperation the government. programme with the International Monetary Fund (IMF). “It will A risky path forward reassure Ukraine’s partners that it is credible and can meet its When outlining an ambitious obligations, even if currently it five-year action plan shortly after seems to be influencing perception taking office Mr Honcharuk pledged more than offering real help,” that he wanted the economy to grow Mr Kyian says, noting that Ukraine by 40 per cent during the course has decent amount of gold reserves of the next five years: by five per in case of trouble. “Nevertheless, cent in 2020 and by at least seven the positive image and the adoption per cent in 2021-2024. In order to of the IMF’s requirements show achieve this, the government will Ukraine’s readiness to change need to raise 50 billion US dollars and implement reform. That in investments. should be appreciated, taking into According to Yehor Kyian, account the difficult situation an economic analyst at Ukraine’s in the country’s east.”

International Centre for Policy The much-discussed IMF Studies, the government has programme serves as a guarantee declared itself libertarian for Ukraine, but the ultimate aim in outlook, and yet has at the same is for the country is to go its own time tried to preserve the social way: the Ukrainian finance minister orientation of the economy to Oksana Markarova has said that the support those on low incomes. country should no longer rely on Besides the ambitious growth plans, cooperation with the IMF by 2023.

While Ukraine’s macroeconomic stability has strengthened, foreign portfolio inflows have increased significantly and economic growth has remained resilient despite pressure from the election cycle. The European Bank for Reconstruction and Development (EBRD) notes that the progress of reform has been mixed: financialsector reforms and public finance reforms have continued as planned, but anti-corruption efforts have suffered a setback, posing an oldnew challenge for the government.

In its latest country-specific report, the EBRD expects the Ukrainian government to implement key reforms such as the privatisation of state-owned enterprises and banks, further anti-corruption measures, the digitalisation of public-sector services, the unbundling of the country’s gas transmission system operation from Naftogaz (Ukraine’s national energy holding) and the opening of the country’s land market. The latter two initiatives appear to be moving forward, although the government’s land market reform plans will likely lead to political disputes as the majority of Ukrainians continue to oppose the initiative.

Although reforms should progress, we must not forget about the risks along the way.

“The quick adoption of reforms may lead to negative consequences.

As such, international stakeholders, whilst pushing for reforms, must understand the specifics of Ukraine’s development, otherwise not the national, but personal interests will be lobbied,” Yehor Kyian warns, stressing that a clearer stimulus should be offered by Ukraine’s foreign partners, taking into account the high price the country has paid for restructuring its economy while simultaneously trying to cope with the Donbas war.

All eyes on the next Normandy summit “Mr Zelensky is still learning how to be a politician, to deal with the different power bases that surround him, and fully understand that complex issues hardly ever have easy solutions, particularly when the Russians are involved,”

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CURRENT AFFAIRS

Amanda Paul, a senior analyst of the European Policy Centre tells Emerging Europe, adding that “this is definitely the case when it comes to the conflict in the Donbas.”

Vitalii Martyniuk, the acting executive director of the Centre for Global Studies Strategy XXI, a Ukrainian think tank, shares a similar opinion. “At the beginning of his presidential term Mr Zelensky thought he could easily end the war.

Mr Poroshenko was equally naive in 2014. The president’s first plan to stop shooting, withdraw forces and reintegrate territories - has failed. Despite some positive results and withdrawal at some points, a ceasefire has not been kept,” he argues, noting that the president’s mistake is that he has not yet insisted on the withdrawal of the Russian troops and weapons without which peace cannot be reached.

Discussing the so-called Steinmeier formula, a peace process plan endorsed by the president which would grant permanent special status for Donbas if local elections are conducted under Ukrainian law and follow international standards, Mrs Paul says that the plan has exposed the president’s political inexperience, along with that of his team which failed to manage the

fallout correctly. Mr Martinyuk adds that the formula should not be the primary step to achieve peace, but “rather the third, after ceasefire and the withdrawal of Russian forces, as the formula concerns local elections, which could not be organised in the absence of security.”

According to him, elections are the way to solve an internal conflict, not a Russian-waged war.

After months of hesitation from the Russian side, Ukrainian and Russian leaders are again set to join their French and German counterparts for peace talks in Paris. Mrs Paul believes that the remarks of the French president Emmanuel Macron, who called for reengagement with Russia, have been “extremely unhelpful.”

“They have added weight to concerns that France and Germany are pressing Zelensky to move ahead with the Steinmeier formula in order to improve relations with Russia. Given that it is Russia which has troops on Ukrainian territory, the pressure should be on Moscow,” she says, noting that any belief Mr Zelensky could have ended the conflict on his terms was naive, as Russia is "ready to play the long game.” •

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EMERGING POLITICIANS

CURRENT AFFAIRS

On these pages we provide a channel for young politicians from across emerging Europe to share their vision of the kind of Europe they want to create. All of the young people whose voices we feature are unblemished by their countries’ communist-era pasts. Where the current generation of older politicians has often failed, it is our hope that this young, free and enlightened generation will succeed.

Emerging Europe is delighted to be able to offer them a platform from which they can communicate with a wider audience outside of their home countries.

Irena Joveva

"I have a different view of how I imagined politics to be, and how I think it should be."

to take up the challenge. I didn’t accept because I wanted a higher salary or status, but because I felt a responsibility to those people like me, who were appalled by powerhungry politicians with no sense of reality. Instead of complaining about the situation, I had received the opportunity to walk the walk.

As a young politician – not only in age but also in terms of how long I have been actively involved in politics – I have a different view of how I imagined politics to be, and how I think it should be. In my opinion, politics and Irena Joveva, 30, is a newly elected the policymaking process are like Member of the a living ever-changing organism; European Parliament representing Slovenia . you are under constant pressure to adapt to current mounting issues.

Since Slovenia became an have been a member of the independent country, in 1991, European Parliament, since many things have changed in our July 2019. My previous career national politics. It all started well, was in journalism; but, today, I am with our having a solid groundwork on the other side of the microphone. for developing the country as Honestly, the choice to become a whole, but somewhere in between involved in politics wasn’t easy for things got complicated. Slovenia me. As I was a journalist, I thought has always had very fragmented I was going to be the first person to political milieu. This fragmentation find out which names were on the has escalated in the last couple of European electoral candidates’ list, years. We have been faced with when I received an invitation to an quickly-rising and quickly-fading interview from the Slovenian PM. political parties which occupied Although I did find out the names, a significant number of seats in I was also puzzled to discover that the national parliament. Due to they were planning to put my name the lack of a political desire to on the list – as the lead candidate. cooperate between parties, chaos After some long consideration and was created. Our adaptation to a bit of back and forth, I decided developing issues resulted in our

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adopting legislative changes, which meant we had the same issue regulated in several different laws, instead of creating much-needed structural reforms.

None the less, in 2004, Slovenia was the first ex-Yugoslav republic to join the European Union, and we have contributed to EU policies ever since. As we were once the same country, I am focusing my work on the Western Balkans and the promotion of EU enlargement.

As a member of the culture and education committee, I will dedicate my work to improving conditions for the younger generations. As a substitute member of the environment and public health committee, I will focus on topics related to protecting the environment as well as cancerrelated issues.

It is a real privilege to be able to change European legislation, but it is also a huge burden. My first legislative file is the European Solidarity Corps, which aims to offer opportunities to young Europeans to volunteer in the global solidarity sector.

As an MEP, my main goal is to do everything in my power to change things from within the monster of politics. This ambitious goal is one of my two main challenges.

The other is to remain who I am and not to fall into indifference or to become somebody whom I find appalling. •

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CURRENT AFFAIRS

Uldis Budriķis

strategic and developmental plans.

It takes only the question Why? to knock one off the rails. Old politics are characterised by beautiful theses, long and broad plans and visions of the future - things that are discussed in the form of the future. All this is necessary, but the danger is that the public is tired of fairytales. It looks forward to the real work here and now.

I know that this does not characterise only Latvian politics.

We can observe the wave of populism which has swept across European and other countries.

And mostly it grows from frustrated people who are tired Uldis Budriķis is a Latvian MP. of waiting. Knowing this, I see that now more than ever that elected Latvian politicians have a heavy, but responsible burden y first 100 days in on their shoulders – restoring and the Latvian Parliament maintaining public confidence have passed. This in democracy. is usually the moment when In these first 100 days I have the public first measures what understood and re-verified that politicians have done and achieved. in order to reach society, there are In retrospect, I can say that this two important factors – attention stage has been a close combat to detail and communication. between old and new politics.

There is a saying: “the devil is The political party I represent in the details” - yes, if you fall into in the parliament is as new and it and forget about the ultimate inexperienced as I am. Usually, goal. One of the lessons I have when one is inexperienced, we tend learned is that it is impossible to think that it’s a disadvantage. to solve and communicate There is, of course, a natural qualitatively multiple problems tendency for older parties their at the same time. There is a risk of years of knowledge and experience slipping into details. As I see it, to obstruct any initiative from a politician is a visionary who has new parties and MPs, especially to see and work on one or two high when it comes to changing the and achievable goals. And only routine, making processes open when those goals are achieved, and transparent. This time I one can focus on the next. Sounds feel that not knowing all the simple? It isn’t. quirks and tricks of old politics is Once you have entered a whole an advantage. new environment where you For example, officials usually have real power, suddenly there prepare plans, reports, statistics is a feeling that takes over, you and present them in excel tables. can patch up all absurdities. And Everyone takes them into account you start to be dragged on all and looks forward to the next sides, you sink into the whirlwind report. And without a doubt, data of events and, as I mentioned and reports are very important, above, you forget about the but we tend to lose connection ultimate goal. In the parliament with reality. In Latvia there is I work in the Commission for even a common understanding Public Administration and Local that we have the best writers for Government. When I came to work

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in this commission, I knew there were several valuable bills that had been "forgotten in the drawer" for years. My goal is to take them out one by one. One of the first laws I have updated and am working to get passed as soon as possible is the County Referendum Law. A law that would give the residents of Latvia's counties another tool - a way to express their position.

Often politicians point out that elections are a way for the public to appreciate the work of politicians.

If you have worked well - you are elected, if not you are not elected.

But we all know that is simply not true. People tend to forget the wrongdoings of politicians, and some no longer take the opportunity to evaluate the work of politicians by simply not going to vote.

I believe that there must be other ways in which the public can keep their fingers on the pulse.

A referendum law would allow county residents to decide on county development plans, whether any of the municipal construction plans should be supported, and whether the elected council has lived up to its expectations. Namely, if the council works against the interests of citizens - there is no need to wait for the next elections, it could be dismissed. I think that by implementing the referendum law in the counties, we will strengthen the public's confidence in democracy.

Concluding with the second important factor – comunication – I believe that we should explain all decisions as precisely as we can. A politician must be able to answer not 100 questions, but one question 100 times. •

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‘Nord Stream 2 is in conflict with several of our common European goals’ Rebecca Harms, a former German member of the European Parliament for the European Greens, speaks to Emerging Europe about Nord Stream 2, its political implications within the European Union and what the pipeline means for the continent’s energy security.

WORDS DOMINIK ISTRATE

Rebecca Harms

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he construction of the Russiabuilt Nord Stream 2 pipeline, which will run from western Russia through the Baltic Sea to Germany, will in all likeliness be finished by early 2020. The project, as well as Germany – its greatest European supporter – has long been criticised not just for energy security reasons, but for what it means to the fragile geopolitical situation on Europe’s eastern borders, and its environmental impact.

One of the main opponents of the project has been Rebecca Harms, a German politician who served as a Green MEP until May, and as a member of the European Parliament’s energy committee.

In an open letter, co-written with another 90 EU lawmakers

in 2018, Mrs Harms argued that by supporting the pipeline project, the German government was going against the will of the European Commission, the European Parliament and the majority of EU member states. “[The German government] is allowing a major rift between EU member countries to fester at a time when the EU needs cohesion more than ever before,” the MEPs wrote, noting that neither Europe nor Germany can afford such a divisive political situation.

Speaking to Emerging Europe, the former MEP reiterates her position.

“Nord Stream 2 is in conflict with several of our common [European] goals,” she says.

“Namely, our goals to secure

the energy supply by diversification of our imports,” pointing to Europe’s previous experiences with Russia, which in both 2006 and 2009 decided to halt the transit of its gas via Ukraine over pricing disputes. “It is also in conflict with the EU’s climate targets and the commitments of the Paris Agreement, since Russia uses EU money earned from gas purchases to invest in more infrastructure for fossil fuel production and management,” she adds, noting that the European bloc will not be able to achieve the decarbonisation of its economies and meet the obligations of the Paris Climate Agreement if it “continues to develop and pay for this huge fossil fuel infrastructure.”

According to Harms, Russia’s reduction in gas supplies to countries like Austria, Germany and Slovakia in 2014, in reaction to EU sales of gas to Ukraine during the then evolving crisis in Crimea and the Donbas, triggered an EU-level debate on the energy dimension of security issues. “Since then, we have discussed how to achieve a more robust security of supply not only for us, but the Eastern Partnership countries,” she points out, adding that “it is a big mistake by the German government to pursue Nord Stream 2 in spite of all the negative experiences the EU has faced with President Putin in the past.” Mrs Harms believes that the sectoral economic sanctions the EU imposed on Russia over its illegal actions in Ukraine represented “the most important political reaction” by the EU to the Ukraine crisis. “Germany is undermining this reaction by supporting the Russian pipeline,” she stresses.

Germany, whose imports of Russian gas are set to increase, has long justified the pipeline project as necessary, and is now facing increasing pressure to deliver on earlier promises by Chancellor Angela Merkel to phase out fossil fuels and boost its economy – particularly after it was revealed that the country will not be able to meet its energy targets for 2020.

There is also much doubt over whether its climate targets for 2030 are realistic. However, Mrs Harms argues that the German government’s recently announced climate action plan, in which it aims to speed up the decarbonisation of the country’s economy, is not what she would call a “total failure.” While she considers it insufficient, she adds that it is the right way to restart Mrs Merkel’s commitments.

However, “Nord Stream 2 is in conflict with both Germany’s climate goals, Mrs Merkel’s support for decarbonisation and her position to support Ukraine with sanctioning Russia’s actions,” she says, noting that Russia’s declaration earlier this year to cut gas transit via Ukraine once the pipeline is completed proved once again that the aim of the project is to weaken Ukraine’s positions.

“The EU must think big” Discussing her expectations from EU bodies on overall fossil fuel use, Mrs Harms believes that the EU “must think big” when it comes to climate and energy security. “For me, a Climate Union or a Treaty for Renewables and Efficiency is the positive future project the time is right for. Such a new treaty or agreement could boost innovation in industry and the economy, create jobs and breathe fresh spirit into the European project,” she stresses, adding that such initiatives would be not just a strong answer to the ongoing climate protests all over the EU, but an invitation to young people to engage in the future.

“Increasing imports from Russia decreases our independence.

We still lack a common energy strategy to decrease our dependence on highly problematic export countries, to strengthen

investments in sustainable energy production and consumption,” she continues, emphasising that “not only renewables but investments in savings and efficiency would be of greater benefits for EU citizens.”

The former German MEP sees the development of renewable energy sources as one of the main areas where sustainable innovation can be achieved. “Phasing out nuclear and all fossil fuels for electricity production is feasible.

But the process is not without challenges and needs more will and attention. We have to speed up this challenging process if we agree on the urgency of tackling climate change,” she tells Emerging Europe, emphasising that Ursula von der Leyen, the incoming president of the European Commission, has made considerable promises towards fighting climate change, including the implementation of a “European Green Deal”, an initiative formerly proposed by the European Greens.

“I hope that the new Commission is not only promising but will deliver over the coming years.”

gas giant. “What has been achieved is not yet the end of the new pipeline,” she concludes, however, she notes that “at least the pipeline has to comply with the EU rules” after the Council of the European Union amended the EU’s Gas Directive and agreed to extend the scope of EU frameworks on thirdparty suppliers.

With Nord Stream 2 nearing completion, it remains likely that the finished pipeline will indeed deliver gas to Europe. Nevertheless, if Gazprom refuses to comply either with the amended EU Gas Directive or the European Court’s recent decision to limit gas transit via a German Nord Stream pipeline link, there remains a scenario in which the new European Commission will have to take action. “It would be a major mistake if the European Commission would allow Gazprom to escape from the agreed rules.

It would set a precedent and would weaken the power of the Commission. They would lose what has been achieved for the EU’s institutional power in a very important part of the common market and for our common No stopping now? security,” she warns.

The former MEP believes that Mrs Harms points out that the EU would also be forced to halt European institutions driven by Russian gas deliveries via Nord a strong, multi-party coalition Stream 2 if Gazprom and Ukraine’s of EU lawmakers across the state energy holding Naftogaz Scandinavian and Eastern do not reach an agreement on European member states have tried gas transit through Ukrainian hard to find a political consensus pipelines to Europe. EU-mediated against Germany’s will to increase talks between the two sides have so cooperation with Gazprom, Russia’s far not led to a deal. •

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Business

A trade deal between the Mercosur countries of South America and the European Union – years in the making – is being threatened by populists in Argentina. How will emerging Europe be impacted? Find out more on pages 38-39

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BUSINESS

Tunnel vision A tunnel linking Tallinn with Helsinki may no longer be a pipe dream, but obstacles to the ambitious project remain.

WORDS PORTIA KENTISH

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n May 2016, Finnish development company FinEst Bay Area, led by Finnish entrepreneur Peter Vesterbacka – a former executive at the company behind the Angry Birds game – began working on an unprecedented project: to construct a rail tunnel between the Estonian capital Tallinn and the Finnish capital Helsinki. The aim of the tunnel is to connect the two cities with the latest in rail technology and spur economic growth and development to the region.

However, the project is facing mounting criticism. Some parties believe the push to get it completed by 2024 is too unrealistic. Others see it as far too accommodating of China’s Belt and Road Initiative.

A ferry compelling case Currently, 10,000 Estonians commute every day to work in Helsinki by taking a two-hour ferry ride, while many Finnish tourists cross the Gulf of Finland each weekend to take advantage of Tallinn's gorgeous Old Town and Estonia's relatively low alcohol

prices. The proposed tunnel would connect the two capitals via a 100-kilometre underground rail network, shortening the commute to 20 minutes. Supporters of the project note that this is what many commuters would spend getting to work in the same city, let alone another country.

Unsurprisingly, there has been a lot of talk in the region about the project, many seeing it as a positive for the entire European continent. Anne Berner, then Finnish transportation minister, noted in 2018 that the tunnel would, together with the Rail Baltica railway project and the Arctic railway line, "connect the Arctic region with the heart of Europe via Finland.

The tunnel could thus be a significant project for all of Finland and Europe, not only for Helsinki and Tallinn.”

The tunnel will make use of unprecedented technology in order to future-proof the project.

The tunnel diameter is to be a huge 17 metres, keeping the possibility open for “more than just trains” in the future. Two tunnels will be constructed in order to have multiple trains operating

simultaneously. This of course leaves sizeable amounts of rock to be removed. The plan is to turn the rock into two islands 15 kilometres from the respective coasts. The larger island, off the coast of Finland, is set to become an entertainment centre with shops and businesses, with the developers planning on making the island a destination in its own right.

“The artificial island will mainly be built for technical and safety reasons, providing such things as emergency exits and ventilation," Kustaa Valtonen, a FinEst Bay founding partner, tells Emerging Europe. "A second reason is environmental, as it is the best location for the extracted rock.

Thirdly, the economic benefits are big. The island will be a future-proof city with energy positive status and will be fully SDG compliant.

There will be no cars but walkways to make moving around easy, with modern last-mile delivery solutions to support a happy life.”

Not all about cost The project also has sizeable economic benefits for the region.

Connecting the two capitals will increase the exchange of capital between them as well as forging closer business ties. Moreover, the project itself has an emphasis on employing local and regional workers. According to Mr Valtonen, the projected employment impact for Finland and Estonia is 24,000 and 6,000 respectively.

However, a 2017 public feasibility study published by the Finnish and Estonian governments projected that that by 2050 annual demand for the tunnel would stand at 12.5 million passengers and four million tonnes of freight. This gave the project a cost benefit ratio of just 0.45.

The Estonian European Commission Director General for Mobility and Transport Henrik Hololei has questioned the tunnel’s necessity, stating that: “We are speaking of an investment in the range of 1520 billion euros, even though today we have ship connections which ensure relatively fast transit from Tallinn to Helsinki. I am absolutely certain that if this tunnel should materialise, it will not make things cheaper in any way for the passenger.”

In spite of this, the feasibility study projected that it was also predicted to provide a regional development boost of 4-6.9 billion euros annually. This injection into the economy was seen to outweigh the potential lack of use of the tunnel, leading the report to conclude that construction should go ahead.

That same study also put the project completion date at 2040, not December 24, 2024, as projected by developers. In July of this year, Estonia's public administration minister, Jaak Aab, restated that the project was unrealistic. However, when Emerging Europe asked the developers what they made of this government study, Mr Valtonen said that “the pre-feasibility study was very pessimistic in its approach. Our estimate is based on the designers and constructors capabilities and is very realistic,” further noting that it is better to trust their own figures of estimation.

Chinese whispers This is not the only controversy to hit the project. Much of the funding

has been secured from Chineseowned companies, raising some questions amongst critics. As much as 15 billion euros in funding has been sourced from the Chinese Touchstone Capital Partners, which owns a minority stake. In July, a memorandum of understanding was signed with the China Railway International Group, China Railway Engineering Company and China Communications Construction Company, as well as Touchstone. When prompted about the stake of Chinese investment, the developers noted that less than half of the funding was coming from Chinese-owned companies.

“Our goal is to also secure European, Nordic and Finnish capital investment in addition to the already agreed financing arrangement. We are looking for a sustainable and fully-balanced financing solution for the project,” said Mr Valtonen, who suggested that looking towards China had more to do with technology, in which China is a world leader.

However, Estonia's economics minister, Taavi Aas, noted in a recent interview with Bloomberg that: “We need a clear understanding of where the money is coming from and in what amount. Where are the guarantees that it will be completed?”

Mr Hololei has voiced similar concerns, warning that Chinese investors must act within accordance with EU rules and regulations, saying in March that: “All investments that come to Europe from third countries are welcome if they are guided by European rules.”

Some critics view the project as being part of the Chinese Belt and Road Initiative (BRI) - a statesponsored infrastructure and development programme that is currently investing in 152 countries across the world, which aims to push for Chinese dominance in global affairs by creating a Chinese-centred trading network.

Mr Valtonen insists, however, that “Finest Bay project is not part of the BRI programme,” arguing that if there are synergies, these are coincidental, and pointing to a similar situation with the European Union's TEN-T project.

'It would be stupid not to build it' There is no doubt that the project is one of the boldest Europe has seen for decades. The developers claim that the tunnel will last until “after the next ice age”.

They see the project as unique and pioneering, and despite the apparent hurdles and criticism, if completed successfully, the Helsinki-Tallinn tunnel is set to be the largest and longest tunnel of its kind, bringing many benefits to the region.

When asked in a recent interview if the project would happen, or if it would be forgotten in a few years, Peter Vesterbacka responded with the words: “It's too late to be forgotten. It’s too important. I don’t think we can afford not to build the tunnel. It’s for the future of our countries, it would be stupid not to grab the opportunity and make this real.” •

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C O V E R

S T O R Y

Capital Living 2020:

What makes Prague and Tallinn

the best places in emerging

Europe to live?

Emerging Europe crunched the numbers to find out which of the 23 capitals of the region offers its citizens the highest quality of living. Prague came out on top, closely followed by Tallinn. We visited both to speak to residents and discover for ourselves just what makes them so special. We also visited Kyiv – which performed worst – and quickly realised that even there, life is better than ever.

WORDS CRAIG TURP. ADDITIONAL RESEARCH BY PORTIA KENTISH

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arly one crisp November morning, long before the hordes of visitors that can make the centre of Prague feel like a central European Disneyland have even begun tucking into their buffet breakfasts, I strolled the length of Na Příkopě, one of the Czech capital’s most eclectic, busiest, streets.

A commercial hub for centuries, Na Příkopě connects Wenceslas Square – the site of the mass protests of 1989 which became known as the Velvet Revolution and brought down the Czechoslovak communist regime - with Náměstí Republiky, home to the iconic Obecní dům, whose lavish exterior complete with Homage to Prague mural by Karel Špillar is topped only by the splendid atrium of the Smetana concert hall inside.

My walk in November was something of a rather indulgent trip along memory lane. For a number of years in the late 1990s I was lucky enough to call Na Příkopě home. Almost. I worked in one of its many elegant office buildings, but home – during the week at least, I returned to Bucharest at weekends - was actually an apartment around the corner at Dlážděná.

A city for the ages I had returned to Prague – for the first time in more than a decade - to find out (or perhaps, remind

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TOP 10 1. Prague - 66 2. Tallinn - 67 3. Ljubljana - 95 4. Vilnius - 101 5. Warsaw - 124 6. Riga - 130 7. Bratislava - 131 8. Budapest - 135 9. Zagreb - 136 10. Minsk – 144 Cities are ranked (with the lowest score denoting best performance) according to scores obtained across 13 categories: Life Expectancy, Public Healthcare, Road Safety, Average Commute, Internet Speeds, Air Quality, Universities, Unemployment Rate, Corruption, Personal Freedom, Ease of Doing Business, Cost of Living, Purchasing Power. Sources include the World Bank, the World Health Organisation, CATO Institute, Transparency International, Air Visual and Numbeo.

myself) what makes this city the most pleasant of all emerging European capitals.

At the time I lived there, Prague was the perfect city in which to be based. Regularly needing to fly throughout the emerging Europe region, even before the arrival of the low-cost airlines it offered direct connections to just about everywhere, was relatively cheap and packed a cultural punch well above its weight. There was never a shortage of world class events to attend, be it an opera or an exhibition. It also offered the best beer in region. I am glad to report – after much research - that it still does. The best beer, and much more besides.

For according to a major new study carried out by Emerging Europe, the Czech capital offers its citizens the highest quality of living of all the 23 capital cities of the emerging Europe region.

Our survey looked at a wide range of indicators from leading European and global organisations, from life expectancy and healthcare to the quality of public transport and education, the cost of living, pollution levels and road safety.

Prague came out on top in a number of different categories, offering its residents the best public healthcare, the safest roads and the highest number of universities in Europe’s top 1,000. The city also boasts even better transport connections to neighbouring countries than ever, high-speed internet, low unemployment and a high level of personal freedom.

What’s more, while the cost of living in Prague is relatively high for the region, purchasing power is also the highest of any capital city in emerging Europe. I certainly noticed that the price of most everyday goods had increased considerably, but when compared with much of Western Europe, it remains an extraordinarily cheap place to live.

“I don’t think that Prague topping this Quality of Living study will come as too much of a surprise to anyone,” says Andrew Wrobel, founder and director of content and research at Emerging Europe.

“It is a city which has retained its medieval charm while ensuring

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FASTEST INTERNET 1. Vilnius 47 2. Zagreb 46 3. Tirana 45 4. Prague 44 5. Tallinn 43 Score in Mbps, according to SpeedTest.net

that it still moves with the times.

It’s a great hub for new businesses in a variety of fields, an easy place to get to and is in many ways the beating heart of Europe. That so many foreigners have relocated to the city speaks volumes for its international appeal and ability to attract new talent. It’s an old, historic city but it feels young. There are few places in the world that can pull that off.”

One of those foreigners who now calls Prague home is Juan Huitz, an American banker who has lived in the Czech capital for more than two decades and recently became a Czech citizen.

“What makes living in Prague appealing is first and foremost the basics,” he tells Emerging Europe.

“The public transportation system is good and following the Vltava north or south by bike takes you easily into the beautiful countryside. It’s also incredibly safe.”

expensive anywhere in emerging Europe, rising salaries, driven by the tech boom, mean that residents have more purchasing power than those of any other city in the region except – perhaps surprisingly – the Georgian capital Tbilisi.

"Tallinn's a great place to live because it's just the right size: it's not too big, and it's not too small," says Kyllike Johansson, a Tallinn local, who runs a small publishing company in the Estonian capital.

"There are lots of cultural events and world-class art centres, museums, a wonderful culinary scene and all of it is within reach, helped by free public transportation The big village as well as small distances. There are a lot of green spaces as well as In our survey, Tallinn comes just the seaside, and lots of beautiful behind Prague in second place, nature even within the city itself. the city boasting the lowest levels There's good flexibility for work, of corruption in the region, good with choosing your own hours and public healthcare, a high ease working from home encouraged. of doing business score and the Innovative digital solutions make wonderfully clean air offered by its everyday life easier. We also have proximity to the Baltic Sea. A hub of a great healthcare system that is entrepreneurial activity – especially covered by our taxes," she adds. in the technology field – it has been "Another nice aspect is that central to Estonia's emergence as as Tallinn is a big village, it's a digital heavyweight. easy to communicate with the While the cost of living in the municipality, there's very little Estonian capital is the second most hierarchy and bureaucracy."

Some surprises The top 10 of our study is completed by – in order – Ljubljana in Slovenia, Vilnius in Lithuania, Warsaw in Poland, Riga in Latvia, Bratislava in Slovakia, Budapest in Hungary, Zagreb in Croatia and – perhaps surprisingly – Minsk in Belarus.

Minsk is the only non-European Union city to make the top 10, and although the city scores poorly for transparency and personal freedom, it offers its residents (again, perhaps surprisingly) the cleanest air in the region and almost zero unemployment, as well two of Europe’s leading 1,000 universities.

Doing business in the city is also considerably easier than in a number of EU capitals, including Bucharest, Sofia and Zagreb.

The shortest average commute is in the Montenegrin capital Podgorica (a result, no doubt, of its small size) while Vilnius has the fastest internet.

Bucharest, so long the European champion of fast internet speeds, has fallen behind, barely scraping into the top 10. Minsk has the lowest average internet speed, at just 14Mbps.

Yerevan in Armenia has the most dangerous roads, at least in terms

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LONGEST AVERAGE COMMUTE 1. Kyiv 43 2. Bucharest & Tirana 42 4. Baku 40 5. Budapest & Tbilisi 38 Average daily time spent travelling to/from work in minutes, from Numbeo.com

rebuilt during the late 1940s and early 1950s – not a great time for Ukrainian architecture.

Serhiy Cherniavskiy owns a printing shop in the city. He is proud to call it home, and – unlike many of his compatriots – doesn't dream of living elsewhere. of the number of people killed each "The beauty of Kyiv is knowing year in road-traffic accidents as what the city and its people have a percentage of the population, while been through and then realising Prishtina can boast the cheapest cost just how much we have achieved," of living. he tells Emerging Europe. "Many of the problems that the city faces are Not a great time for Ukrainian what I think some people refer to as architecture first world problems. There are too many cars, too many people, too It is the score we have allocated much noise. But those, to me, are for that low cost of living which signs of a city that is developing fast. manages to keep the Kosovan capital My grandparents moved here many from taking last place in our study, decades ago and had nothing. They the dubious honour of which goes to had to rebuild a city that had been Ukraine's capital, Kyiv. The city has destroyed, in which everything, the longest average commute in the including people, was in short region at 42 minutes, the joint-lowest supply. When I think of their life-expectancy (at 72 years) and experience and compare it with my relatively slow internet. own, I consider myself lucky to live However, it's not all bad news for in a city that is growing, a city that residents of the Ukrainian capital. offers something. I know that we The city can boast clean air, two do not have the most picturesque leading universities in Europe's buildings in Europe – we don’t even top 1,000 and a relatively low cost have the most picturesque buildings of living. in Ukraine - but this is a still The first thing that strikes the visitor beautiful city to anyone who knows to Kyiv (never Kiev – see page 58 to its history, and few people know find out why) is the sheer scale of the their history as much as we do." place. Everything, from the width of Cherniavskiy's comments will the roads to the size of the buildings resonate with the vast majority of screams of a city that was designed people across the emerging for giants, not for people.

Europe region.

It's not surprising: all but Complaints about traffic make destroyed in World War II Kyiv was older generations remember

BEST AIR QUALITY 1. Minsk AQI 13 2. Sarajevo & Tallinn AQI 21 4. Baku AQI 25 5. Kyiv & Vilnius AQI 29 Ranked by US AQI, according to Air Quality Index, on a scale of 0 (best) - 500

the times when few had cars, or when petrol was rationed. Queues at supermarket checkouts remind the same generation of a time when shops would run out of basic foodstuffs. Serhiy Cherniavskiy has recently bought a new house close to one of Kyiv's airports, Zhuliany.

Even the noise of the planes is, for him, a wonderful thing.

"When I was a kid we couldn't even dream of flying in an aeroplane.

You had to be somebody very important. Now, anyone can afford a ticket. Seeing and hearing the planes flying over my home is joyful," he says.

All of the 23 capital cities of emerging Europe – including Prague and Tallinn, which are suffering from overtourism - face challenges.

But these, as Mr Cherniavskiy points out, are increasingly first world challenges, the same as any major city anywhere in the world: providing adequate housing for all, offering decent public transport, good health care, good schools and safe roads. Fighting climate change, pollution and inequality.

Cherniavskiy's optimism however is infectious, and he is right about the need to remember the past.

For regardless of whichever of the 23 capital cities of emerging Europe in which we live, the chances are that life has never been better, and life will continue to improve.

Next year, when we once again carry out our study, we shall find out which cities have improved the most. •

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Armenia’s economic reforms pave the way for more investment Armenia is actively working to better position itself on the investment map by creating a more attractive business climate. Foreign investment will be crucial for maintaining the economy’s so-far robust growth rate.

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rmenia is no exception to the global foreign direct investment trend.

Investment flows are struggling to recover from the heights reached before the financial crisis.

A wait-and-see attitude prevails among investors, who have reacted with caution to the recent political transition,” the United Nations Conference on Trade and Development's (UNCTAD) recent investment policy review finds. After a significant hike from 184 million US dollars in 2015 to 334 million US dollars in 2016, FDI in the country stood at 250 million USD in 2017 and grew by just 1.6 per cent last year. For Armenia, attracting investment remains a key challenge.

The latest edition of the World Bank’s Doing Business report ranks Armenia’s economy 47th in its list of 190 economies, down from its historic high of 41st place in 2018.

While far from welcome, the drop does not signify a change in attitude towards investors. Far from it: the country is pushing to become an attractive market.

“On the ease of the doing business score, which assesses a country’s absolute level of regulatory

performance, Armenia’s score went up from 73.2 in Doing Business 2019 to 74.5 in Doing Business 2020,” says Sylvie Bossoutrot, the World Bank’s country manager for Armenia, adding that “the country is indeed continuing to narrow the gap with the global regulatory frontier which is a positive and promising development.”

Why Armenia?

According to Mrs Bossoutrot, the country has achieved “substantive improvements” in the business regulatory framework of four key areas over the past year: construction quality control was strengthened by the government’s imposing of stricter qualification requirements and the country strengthened the protection of minority investors by requiring independent reviews, immediate public disclosures of transactions, as well as by increasing shareholder rights and their role in major corporate decisions.

In addition, Armenia made the payment of taxes easier by extending refunds of VAT to cases of capital investment while exporting was made faster by

allowing the online submission of customs declarations.

Aside from the overall World Bank ranking, Armenia made it into the top 10 countries globally when it comes to starting a business. It also ranks higher than any other country in the Commonwealth of Independent States, a positive signal for those seeking access to former Soviet republics.

“If you ask me why you should invest in Armenia, my answer will be the following: investing in a small country with a global network and skilled labour force is promising,” claims Armenia's prime minister Nikol Pashinyan.

Is this the case?

“Armenia’s efficiency profile is characterised by a well-educated workforce, strong skills heritage and competitive salary levels,” UNCTAD’s investment policy review says. While costs related to the workforce are affordable, much attention should be paid to transportation costs: Georgia is the only transit route for Armenian goods due to embargoes from Azerbaijan and Turkey.

The UNCTAD report claims that several industries can aim for a billion US dollars in export sales in goods and services during the next 10-20 years: hi-tech, data science, deep technology, tourism, textiles and garments.

Promoting investment amid a global slowdown Less than a year after Armenia's Velvet Revolution, Mr Pashinyan in February announced an “economic revolution” which, amongst much else, was aimed at creating a better business environment, fighting corruption and protecting the rule of law all three being crucial for those wishing to invest in the country.

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“We see a strong will to reform institutions, fight against corruption, bolster the rule of law and improve the quality of human capital,” says Marina Stefani, the director of sovereigns at US-based international ratings agency Fitch Ratings, which in May affirmed its B+ rating for Armenia. Earlier this year, Standard & Poor’s also affirmed the Armenian economy with a stable outlook while Moody’s changed the country’s outlook from stable to positive.

Dimitar Bogov, the regional lead economist of the European

Bank for Reconstruction and Development (EBRD), who claims that the authorities moved towards greater transparency, adds that a major tax-reform programme was carried out which included cutting corporate taxes from 20 per cent to 18 per cent, from next year. The tax on dividends for non-resident organisations will also halve, to five per cent.

“Reforms need to be institutionalised in a way that does not negatively affect regular operations of the private sector,” the EBRD warns, noting

that “strengthening the tax administration and further increasing the fairness and transparency of the tax framework would facilitate the private sector’s ability to drive future growth.”

If the latest projections of the International Monetary Fund (IMF) prove correct, Armenia can be the growth champion of emerging Europe in 2019: it expects the country’s economy to grow by at least six per cent this year, with the EBRD also projecting six per cent growth. While the global economic slowdown, which seems more inevitable and is likely to impact the whole of emerging Europe, will also impact Armenia, the country’s growth rates will remain significant on the short term.

The IMF has agreed to provide Armenia with 248.2 million US dollars over the next three years, within the framework of a precautionary stand-by arrangement to support the government’s efforts to strengthen Armenia’s economic fundamentals.

However, as Yulia Ustyugova, the IMF’s resident representative in Armenia points out, consumption-led growth may not be entirely fortunate, since it is investment that is “the key building block” for growth in the future.

“So the challenge remains how to generate sustainable, longterm growth that is driven by investment and exports, rather than consumption,” she concludes. •

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The nuclear option No matter how many emission targets we put on ourselves, the quantity of carbon dioxide in the atmosphere keeps growing. While some governments are looking at natural gas as a potential bridge to a sustainable future, many emerging Europe countries are instead focusing on nuclear to both reach the emission targets and diversify their energy supplies.

WORDS CLAUDIA PATRICOLO

O

f the 449 nuclear power plants worldwide, 41 are located in Central and Eastern Europe. Ukraine tops the list with 15 operational reactors and two more under construction.

“The need for the reliable, predictable and clean electricity generated by nuclear has never been greater and, worldwide, that is reflected in the growing number of new build programmes underway,” says Agneta Rising, director general of the World Nuclear Association.

“However, a number of factors – both internal and external – are creating profound challenges for nuclear power in some of its most mature markets.”

Slovakia is the country that relies the most on nuclear: it provides 55 per cent of the country’s total electricity. It is followed by Hungary (50 per cent), Ukraine (49 per cent) and Slovenia (37 per cent).

“Nuclear energy is inevitable in the Hungarian energy mix,” explains Attila Aszodi, professor at the Budapest University of Technology and Economics. “Paks nuclear power plant is not only a carbon-free source of electricity but also the largest power plant in the country. And this provides baseload power.”

“Roughly one third of Slovenian electricity comes from nuclear, one third from lignite, and up to one third from hydropower plants,” adds Iztok Tiselj, head of the Nuclear Engineering Department at the University of Ljubljana.

“The cheapest source of electricity in Slovenia is hydroelectric, which provides between a quarter and a third of electricity. However, roughly half of our hydro potential is already used and there is a legitimate question as to whether we want to use all of our rivers for electricity production.”

“If we are serious about being selfsufficient in our electricity supply and serious about decarbonisation,

nuclear remains the only option: at least at a roughly predictable price,” Mr Tiselj tells Emerging Europe.

“Wind and solar are mentioned as another alternative, but Slovenian wind potential is poor, although solar is fine. However, without efficient electricity storage technologies these two resources can only provide a rather small share of electricity.”

Nuclear at all costs The Czech Republic currently has the most aggressive nuclear policy. The country's prime minister, Andrej Babiš, has said that the country must construct new reactors at the Temelín and Dukovany nuclear power plants, located in South Bohemia and South Moravia, even if it means violating European law.

“We overslept in regards to nuclear energy,” he recently told the European committee of the lower house of the Czech parliament. “We could have been building Temelín by now. We must push this through even if it means violating European law. Energy security is our priority.”

It is not the first time that the Czech Republic - and many other countries – have promoted the construction of new reactors.

The project to build two new reactors at Temelín received a positive environmental impact assessment more than 10 years ago.

A tender, launched by utility group ČEZ, remained open until 2014 but ended after the government refused to confirm a guaranteed purchase price.

“The day after that the tender was cancelled, and the whole project was sidelined with it,” says Edvard Sequens, chairman of Calla, the Czech Association for Preservation of the Environment. “The reason for the hesitation is the lack of clarity on how to push through an uneconomic and risky investment.”

Therefore, the Czech Ministry of Industry looked for other ways to implement its nuclear projects.

One of the solutions, supported

by Mr Babiš, asks ČEZ to finance directly new nuclear reactors, relying on the fact that the company has enough spare cash.

“Sorry, but we're talking at least 200 billion Czech crowns per reactor, probably more,” Mr Sequens tells Emerging Europe.

“A contract is now being prepared between ČEZ and the government, in which the state will undertake to guarantee bank loans, and should the project prove unrealisable, an option should be included in the contract which allows the state to take over the reactors. I am afraid that the guaranteed price of electricity for ČEZ will again be in play and the overall impact could be more than one trillion crowns.”

Industry Minister Marta Nováková told Czech Television that the European Commission suggested her ministry should follow the Hungarian model.

“Energy, primarily nuclear energy, is a political decision, not an economic one,” she said. “There must be the political will to complete the construction of Dukovany or Temelín and a decision must be made about how to finance it. There is not a single nuclear power plant in the world that could have been built without some form of state aid.”

Paks: A positive case of transparency Paks, in Hungary, is a positive example of nuclear reactors being built under totally transparent conditions, primarily because of a battle won by the Green party at European level. Operational since 1982, construction of two new reactors began this year. However, not everyone in Hungary is happy.

“The EU electricity market is currently undergoing a transition,

are obliged to fulfil the conditions of the licenses and the atomic act. If they do their job properly all these issues will be settled.”

At the same time, Slovenian data shows that the risks imposed by the nuclear reactors are much lower than the risks of comparable human activities.

“The minor specific concern is related to the most probable location of the potential new nuclear block. Krško region is seismically active, thus the earthquake resistance of the new block should be and it’s very difficult to say exactly will be carbon-free by 2030 and emphasised,” underlines Mr Tiselj. what it will look like in future,” not by 2050.”

“The impacts of nuclear power says Bender Jávor, a former “I think that the phase-out of coal plants on the environment and Hungarian MP. “Nevertheless, is necessary to reach the climate population are evaluated and it’s quite clear that the market is protection targets of the country,” assessed in the environmental becoming much more flexible and Mr Aszodi tells Emerging Europe. report and the environmental will be based increasingly on local "We see an intensive development impact assessment report as they are small-scale installations. The age in photovoltaic which is driven by developed,” adds Nadja Zeleznik, of big utilities is over, and basethe subsidies. As I see it the capacity chair of the Milan Vidmar Electric load generation will no longer play of photovoltaic cells online could Power Research Institute (EIMV) an important role. In renewables, be 3,000-5,000 MW within few in Slovenia. “The perception costs are declining very quickly. We years, but these capacities will of the public in general is still can also mention natural gas power be intermittent, heavily weather sceptical towards nuclear power plants, the construction of which is dependent. Paks II will have a plants. However, if there would be much cheaper than that of nuclear capacity of 2,400 MW, delivering power plants. This is why, once baseload power. Nuclear can produce a process established, the opinion, in particular amongst the local prices rise, it will still be much more power at a competitive price.” population, could change. There profitable to invest in renewable are mechanisms already in place sources or natural gas.”

Environmental concerns like decrees on compensation for “When you have a large the local community for limited proportion of renewables in your Nuclear power poses land use.” energy mix, you also need flexible environmental challenges: Slovenia’s sole nuclear power energy sources to provide grid accidents, waste, non-proliferation. plant, Krsko (NEK), shut down for regulation,” he continued. “Natural But why are people worried about regular maintenance on October gas power plants are a good fit here, nuclear, even after environmental 1. The process included a change but in the long run even natural gas impact assets have been of fuel and modernisations to could be phased out of the system, approved? In Hungary there have improve the security and efficiency which will be based on renewables been increasing concerns over of the plant. and a high degree of demandthe impact of hotter summers on Slovenia has been considering side management, in other words the availability of cooling water due a new nuclear unit since 2010 but smart technologies and energy to higher water temperatures from no advancement of the project has efficiency. I cannot see any place the Danube river. Also, concerns for nuclear power plants in such have been raised over the suitability been made.

“A new nuclear unit was never an energy system.” of Paks for siting nuclear power seriously mentioned in any of Hungary's president, János Áder, plants due to seismic hazards. the Slovenian energy strategy does not agree. He has announced “The question of the heat load documents,” comments Mr Tiselj. that the country will phase out coal- of the Danube river was in focus fired electricity generation by 2030 during the environmental licensing, “We have been preparing such documents for more than a decade, to help reduce emissions and tackle and the topic of site characteristics but electricity and energy are things climate change. (including seismic issues) during that can always be postponed “Hungary will increase its solar the site licensing process,” says because of some other, more power capacity 10 times by 2030.

Mr Aszodi. “The competent urgent topics, which come across It will stop producing energy from authorities made the necessary the agendas of our politicians. So coal while expanding production steps, prescribing several the key question here is, how to of nuclear power plants,” he said on limitations and conditions related proritise energy related questions September 24 at the UN Climate to the design of the plant. All what in Slovenian politics? I have no idea Action Summit in New York. is written in these specific licenses what the answer to this billion“Thanks to the combined effect of are obligations for the designer these three measures, 90 per cent (the contractor) and for the licensee dollar question could be.” • of Hungary’s electricity production (the Paks II project company); they

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How does the EU’s Mercosur deal impact emerging Europe?

After 20 years of negotiations, the European Union has reached an agreement with the Mercosur states (Argentina, Brazil, Paraguay and Uruguay) for a more comprehensive trade deal. The goal is to remove existing barriers and help EU firms, especially smaller ones, to export more. But many issues are threatening to torpedo the deal before the ink is even dry.

WORDS CLAUDIA PATRICOLO

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hile governments in the Mercosur countries, particularly in Brazil, are trying to move away from decades of populist economic policies, those same policies are now expanding in Central and Eastern Europe – especially in Poland and Hungary.

Brexit – if and when it ever happens - poses further risks, which could lead to increasing protectionist demands.

“On the EU side it is a demonstration of leaders willing to play by the rules in contrast to nationalist ideas, while on the Mercosur side it is about finally moving away from inward-looking trade policies,” Julio Nogues, a member of the Academia Nacional de Ciencias Economicas Argentina told Emerging Europe.

On opposite sides of the Atlantic Ocean, however, there are issues.

Brazil is apparently neglecting environmental issues while several countries, including Slovakia, are threatening to block the deal altogether.

A win-win deal According to the European Commission, the EU is Mercosur’s number one trade and investment partner. In 2018, exports of EU goods to Mercosur totalled 45 billion euros, while services amounted to 23 billion euros (2017 figures).

The deal also aims to strengthen workers’ rights, ensure environmental protection, and uphold high food safety standards.

The outgoing president of the European Commission, Jean-Claude Juncker has called the agreement a win-win deal.

“I measure my words carefully when I say that this is a historical moment,” he commented at the end

of June. “Through this trade pact, Mercosur countries have decided to open up their markets to the EU. This is obviously great news for companies, workers and the economy on both sides of the Atlantic, saving over four billion euros worth of duties per year. This makes it the largest trade agreement the EU has ever concluded.”

The EU-Mercosur region-toregion agreement will remove the majority of tariffs on EU exports to Mercosur, making EU companies more competitive in the region. The EU agri-food sector will benefit from Mercosur slashing existing high tariffs on EU export products, including chocolates and confectionery (20 per cent), wines (27 per cent) and spirits (20 to 35 per cent).

“The EU-Mercosur agreement is a fair and balanced deal with opportunities and benefits on both sides, including for Europe’s farmers,” says Phil Hogan, European Commissioner

for Agriculture and Rural Development. “Our distinctive, high-quality EU agri-food products will now get the protection in Mercosur countries that they deserve, supporting our market position and growing our export opportunities. This agreement also presents some challenges to European farmers and the European Commission will be available to help farmers meet these challenges.”

Boosting CEE industrial exports As regards EU industrial sectors, the deal will help boost exports of EU products that have so far been facing high and sometimes prohibitive tariffs, such as cars (tariffs of 35 per cent), chemicals (up to 18 per cent) or clothing and footwear (35 per cent).

Hungary, the Czech Republic and Slovenia will benefit the most as their exports are heavily concentrated in automotive

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parts (like piston engines), data processing, electronics and electrical machines.

In the case of Hungary, mechanical parts make up 71.7 per cent of exports to Argentina, its main South American partner. Regarding Slovakia, automotive parts, electrical machinery and vehicles account for almost all exports to Latin America, with 50 per cent entering Argentina’s market. Similarly, exports from the Czech Republic to the Latin American countries are heavily concentrated in automotive parts and electronic products (40-50 per cent).

However, not everyone is happy.

“I wouldn’t say [the trade agreement] it is extremely important for CEE, but I would rather say it is marginal or even dangerous for some sectors,” explains Sandor Gyula Nagy, associate professor at the Institute of World Economy of Corvinus University in Budapest.

“Most of Hungary’s exports are high value-added products, which may receive a positive incentive with the FTA. Regarding imports, however, cheap Argentinian/ Brazilian wine, beef and chicken/ egg, may lower prices in the EU, which is not positive for European agriculture, if the EU does not prepare producers for stronger competition,” he tells Emerging Europe.

Slovenia relies the heaviest on Mercosur partners. With 184 companies exporting to Latin America, Mercosur is Slovenia’s ninth biggest trade partner outside the EU. At the same time, despite Mercosur being only Poland’s 11th biggest trade partner, the value of Polish exports amounts to 597 million euros, the biggest of the region.

But Poland represents a particular case since the structure of its trade products is more mixed. Argentina imports mainly capital and consumer goods, while Brazil also imports chemical products and fuels.

Brazil on fire An important chapter of the agreement is that dedicated to sustainable development and the conservation of forests.

Through the agreement, the EU and Mercosur are committed to effectively implementing the Paris Agreement on Climate Change, working towards the transition to a sustainable low-carbon economy.

But 2019 has seen over 10,000 more fires than the Brazilian Amazon has seen on average over the past decade.

France, Ireland and Slovakia have threatened to vote against the trade deal unless Brazil takes its environmental obligations more seriously.

However, the new EU ambassador in Brazil, Ignácio Ybáñez, doesn’t believe that the three countries will stop the deal from happening “We have been negotiating the agreement for 20 years, which is a commitment to the future between the two regions, so it is not true to think that parliaments will react against specific things,” he says.

That said, Slovakia is taking the issue very seriously.

“The way Brazil has lately been treating the Amazon rain forest is unacceptable,” says Slovakian Agriculture Minister Gabriela Matečná. “The European Union must use all means available to make Brazil change its attitude.

We should stop the import of agricultural products and food that are not produced in accordance with European environmental standards and animal welfare.”

“The environmental and human rights issues are valid, and the FTA treaty has several points regarding these,” adds Mr Nagy. “The problem will be the fulfilment and control of these in South America. And if there is a violation of these paragraphs how can the treaty be enforced? The short term effects of the Amazonian fires cannot be neglected, at least in the eyes of public opinion, especially because the Green parties are strong and growing in Europe. And the Greens may try to block ratification in the EP or in national parliaments to win sympathy and votes if the Brazilian and Paraguayan authorities and politicians do not take enough concrete steps regarding environment and human

rights protection. Mercosur is a big (and relatively closed) market, the European firms need to sell and create income.”

So will it – or won’t it – happen?

Slovakia is only one of those countries that might vote against the deal. Argentina itself could also be backing out.

The election of the Peronist Alberto Fernández threatens not just the Mercosur-EU deal, but Mercosur itself. Brazilian President Jair Bolsonaro has hinted that he may call for Mercosur sanctions against Argentina if Fernández moves to alter the trade bloc's current direction.

The outspoken Brazilian president warned he would push for such penalties should a Fernández government move away from lowering tariffs and back out of freetrade agreements made by the bloc.

“Given the outcome of the presidential election in my country, I am pessimistic about Argentina’s future congress passing the agreement,” laments Julio Nogues.

“Unfortunately, it seems that Alberto Fernández will not be interested in an FTA with Europe.

That could delay the entry into force of the treaty by four-eight years,” Mr Nagy adds.

Mr Nagy is less concerned about the more populist governments of emerging Europe backing out of the deal.

“I don’t think that in CEE economic policies are getting more populist,” he says. “Political discourse is another question, but economic policies, no. In general the EU-Mercosur FTA is a political tool to show the world that there are still countries which value free and fair trade. In general, we may state that the winners will be the Mercosur agricultural producers and European industry.

Obviously, the potential losers will be European agricultural producers and the small, inefficient industrial producers of Mercosur countries.

However, the total effect of the FTA will be less than one per cent of the GDP (in the long term), which is not really significant.” •

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10

EE start-ups

to watch in 2020

With the economies of emerging Europe increasingly dominated by innovation and technology, we take a look at 10 of the region's most promising and disruptive start-ups.

WORDS PORTIA KENTISH

StethoMe Poznan, Poland

Mintos

Riga, Latvia Latvian start-up Mintos aims to provide retail investors with a seamless, transparent method to invest in loans from a range of leading providers. It is the world’s largest marketplace of its kind, and is currently enjoying sharp growth rates. Mintos aims to make funding loans more flexible, providing investors with a global outreach.

To date, the company has raised seven million euros in funding, and has facilitated 2.3 billion euros of loans with a net annual return rate of close to 12 per cent. mintos.com

Aimed at improving health and medical services, StethoMe’s technology allows users to examine their heart with an at-home stethoscope. This is then linked to a mobile app which measures for any potential abnormalities, creating a medical record which is sent to a GP when necessary.

Having received scientific support from a number of notable hospitals and universities across Poland, StethoMe is a valuable contribution to the healthcare industry. In 2018, the company raised two million US dollars from TDJ Pitango Ventures. stethome.com

Typing DNA Oradea, Romania

This pioneering behavioural biometrics start-up has created a method of protecting user’s identities based on how they type.

The technology records keystroke dynamics and generates them into personalised typing patterns.

This allows the user’s identity to be verified against their previous patterns. Founded in 2016, this one-of-a-kind start up was selected as one of the top 50 innovative start-ups and is a Techstars NYC alumni. The start-up has now raised 1.3 million US dollars and is expanding its presence to include an office in New York.

typingdna.com

Sharp3d

Budapest, Hungary

shapr3d.com

Founded in 2015, Sharp3d is the world's first mobile 3D design and modelling app. Since its launch the app has been downloaded more than one million times and the company has raised six million euros from European early stage venture capital firms to continue growth and development. It aims to keep up with the rapid pace of modern design and 3D printers, with CEO and founder István Csanády confident that: “we are creating 3D modelling for the 21st century, enabling 3D modelling anytime, anywhere, in a new way that is much easier and more affordable.”

Minit

minit.io

Bratislava, Slovakia

This tech start-up has built process mining software that makes data driven decisions based on how an organisation actually operates. This means it allows companies to easily identify areas for improvement, minimising operational inefficiencies. As founder and CEO Rasto Hlavac explains: ”Minit’s mission is to create fully transparent operations for large enterprises based on what is really going on in their business.”. So far, Minit has raised seven million euros in funding which will help facilitate further development and expansion into international markets.

Millo Appliances Vilnius, Lithuania

Founded in late 2015, this start-up aims to making cooking healthier and easier with its smart, ultra-quiet blender. Unveiled at the Business Design Centre at London’s Exclusively Electrical event in June, Millo has so far secured a total investment of 1.5 million euros, with plans to bring product the market early in 2020 in the UK and the rest of Europe.

Agremo

Belgrade, Serbia

EvoEstate Tallinn, Estonia

getmillo.com

agremo.com

Mapotic

mapotic.com

Prague, Czech Republic Founded in 2017, this intuitive mapping platform accumulates knowledge from its users about the places they love to create a more connected world. Mapotic's mapping communities range from music festivals to street art, not only allowing users to discover what they love, but giving businesses another platform to use for promotion.

Since their launch, thousands of maps have been created, and the company aims to continue to help local communities and non for profit organisations to be discovered.

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BUSINESS

evoestate.com

Launched in February 2019, real estate investment platform EvoEstate is growing fast. It allows users to invest in real estate deals around Europe, allowing access to multiple deal-flow and investment diversification without local regulations.

The start-up is reporting a 100 per cent month-on-month growth, expanding to 18 projects in seven countries, and serving investors in over 52. “Our current growth is actually bringing more value back to our clients because we are able to aggregate more investment opportunities.

And more investment opportunities mean broader diversification, which leads to lower risks and stability of investment portfolio which creates more value to the investors,” explains CEO Gustas Germanavičius.

4NatureSystem

Warsaw, Poland 4naturesystem.com Agritech start-up Agremo has developed an agricultural sensing and imagery analysis platform that allows businesses to achieve a more sustainable, cost effective and efficient level of production.

Aiming to bring digital to agriculture, the company uses aerial imagery, AI, computer vision and machine learning. Since their beginnings in 2015, they have close to 2,000 users from 100 countries and recently launched an independent web platform.

With the aim of improving office spaces, this Warsawbased start-up has designed and installed over 600 meters of vertical gardens since its foundation in 2016. This installation of plants into office environments improves mental health, cleans the air and suppresses noise and dust, as well as being sustainable. In April 2019, it closed its first seed round of funding with a pre-money valuation of 3.5 million euros.

Lifestyle

Dutch duo Telmo Miel, as well as up-and-coming Lithuanian artist Eglė Žvirblytė, are just some of the latest creators to add murals to the increasingly essential Open Gallery in Vilnius. Sensational artwork can now be viewed at a growing number of locations across the Lithuanian capital.

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ARTS

Exhibition

is invisible to the naked eye and to traditional methods of photography that have been used to document Americas Society brings Alice the region’s ruins. With her Miceli’s Projeto Chernobyl innovative radiographic technique, the artist makes the destructive to New York energy visible via direct contact WORDS CRAIG TURP between the radiation and her film, which was exposed in the Chernobyl Exclusion Zone for months at a time. he Americas Society in “In Chernobyl, where the defining New York is currently home quality of the environment is the to an astonishing exhibition invisible radioactive contamination,

by Brazilian artist Alice Miceli, which is pervasive but not perceived dedicated to the explosion as by our senses, the question of the the Chernoby nuclear power plant project became: ‘How to look, in 1986. and by what means?'” Miceli says.

Titled Projeto Chernobyl, the “I see the act of walking through project is a series of 30 radiographs impenetrable spaces as a form of produced in 2006-2010 resistance. It’s not condoning any documenting the residual effects of of the actions that created these the 1986 explosion. The exhibition, spaces; on the contrary, it’s a form of curated by Gabriela Rangel counteraction that confronts them. (artistic director, Museo de Arte I’m specifically trying to access and Latinoamericano de Buenos Aires offer a point of view from within and former chief curator and the land that has been occupied.” director, Visual Arts, Americas The work considers our world Society) and Diana Flatto (assistant in a new way within lineages of aurator, Americas Society), is the first documentary photography and to bring the Projeto Chernobyl series abstraction. “Alice Miceli’s work is to the United States. very unusual and rare within the Miceli developed a method narratives of Latin American art,” of image-making to capture the says Rangel. “She has a unique niche environmental contamination in her research on questions that resulting from the April 26, affect our bodies in a biopolitical 1986 disaster. Though gamma manner. She’s one of the few artists radiation continues to be present, it concerned with the militarisation of

T

Alice Miceli: Projeto Chernobyl can be viewed at the Americas Society, 680 Park Avenue, New York, until January 25.

the world in the bodies and minds of people today.”

The original radiographic negatives are presented as a complete series in light boxes embedded within the walls of the otherwise dark gallery. In addition to the illuminated two-gallery installation, the exhibition comprises a selection of documentary photographs taken by the artist on journeys to the Chernobyl Exclusion Zone in 2008 and 2009, and a video interview with the artist, including footage of the radiographs’ placement and descriptions of her experimental research leading to the radiograph format. Both technically and conceptually complex, Miceli’s work questions our ideas of vision, memory, and trauma.

“Miceli’s work is increasingly relevant today in Brazil, Latin America, and the rest of the world,” says co-curator Diana Flatto.

“It raises pressing issues about clean energy and the environment that go beyond the specific moment or place as we are witnessing destruction of the Amazon, depletion of natural resources, and broader climate change.”

Rather than recording the historical moment of the disaster in Chernobyl, Miceli captured the energy that endures and will haunt the atmosphere of Belarus and the Ukraine for thousands of years.

She terms the areas of her research “impenetrable spaces” where she documents landscapes rendered dangerous by militarisation and industrialisation.

Alice Miceli: Projeto Chernobyl unearths the layers behind nuclear disaster—a continuous threat to human and environmental safety.

Miceli questions the military, economic, and political contexts of damaged landscapes like the Chernobyl Exclusion Zone, inviting a confrontation of the history of our society.

Books

Publisher’s Prize for best debut 1993-94.

Her real breakthrough however came with her third novel Prawiek Olga Tokarczuk: i inne czasy (Primaeval and Other Poland’s Nobel laureate Times), published in 1996. This WORDS JERRY CAMERON subtly built family saga in several succeeding generations is set in a mythical place with strong olish novelist Olga Tokarczuk symbolical impact, while, at the was in October named the same time, being full of realistic and winner of the 2018 Nobel prize vivid details. It starts in the year 1914 for literature. Austrian author Peter and deals with the Polish history Handke, who delivered a eulogy at of the 20th century. Tokarczuk the funeral of Serb dictator Slobodan has claimed that the narrative Milosevic, was controversially was a personal attempt to come to named the 2019 winner. terms with the national image of Tokarczuk is the fifth pole to win the past. The novel is an excellent the prize. example of the new Polish literature “I believe in a literature that which emerged after 1989, resisting unites people and shows us how moral judgement and unwilling very similar we are, that makes us to represent the conscience of the aware of the fact that we’re all joined nation. Instead it shows a remarkable together by invisible threads,” said gift of imagination with a high Tokarczuk after hearing the news degree of artistic sophistication. that she had won the prize.

But the device of a linear fable with The award of the 2018 prize an omniscient narrator, as well as the had been postponed from last strong metaphysical undercurrent, year because of the “reduced are abandoned in 1998’s Dom public confidence” that followed dzienny, dom nocny (House of Day, rape accusations made against House of Night). In this rich blend of Jean-Claude Arnault, the French beautiful and striking images one husband of Katarina Frostenson, finds the intention to depict a whole a member of the committee which region with many, conflicting decides the winner. cultures, individual fates and Tokarczuk was given the prize perspectives. for what the committee called Perhaps Tokarczuk’s best-known “a narrative imagination that with work however, at least outside of encyclopedic passion represents Poland, is Bieguni, (written in 2007 the crossing of boundaries as and published in English as Flights a form of life”. in 2017). In the latter she is not so She has long put her success down much concerned with the landscape to the source material her home of the border as with the phenomenon country provides. of border-crossing. The title is taken “It’s a great place for a writer,” she from the name of an old Russian, said in an interview earlier this year. gnostic sect whose members “Nothing is obvious in Poland, you believed that constant movement have to narrate everything afresh.” prevents the triumph of the evil Tokarczuk was born 1962 in the demiurge. Even here Tokarczuk is small town of Sulechów, and today driven by the attempt to contain lives in Wrocław. Her parents were a multitude of often contradictory teachers and her father also served perspectives into one whole. In this as school librarian. In the library pursuit she includes old maps and she read pretty much everything she drawings of wanderings that convey could get hold of and it was here that an impression of a vast encyclopedia, she developed her literary appetite. mirroring a world in constant flight.

After studies in psychology Her montage of diverse fragments at the University of Warsaw she of narrative and essay-like prose is made her debut as a fiction writer full of memorable reflections and 1993 with Podróz ludzi Księgi episodes, where the recurring tropes (The Journey of the Book-People), set are physical movement, mortality in 17th century France and Spain and the meaning of home. where the characters are in search of In 2018, Tokarczuk became the a mysterious book in the Pyrenees. first Polish writer to win the Man The book was well received and Booker International Prize, for Tokarczuk was given the Polish Jennifer Croft’s translation of Flights.

P

Olga Tokarczuk

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LIFESTYLE

It is 2014’s Księgi jakubowe (The Books of Jacob) however that is widely considered to be Tokarczuk’s finest work (Croft is currently working on the English translation).

A 1,000-page epic set on the border of present day Poland and Ukraine its protagonist is the charismatic 18th century sect leader Jacob Frank, a Jewish-born religious leader who led the forcible conversion of Jews to Catholicism.

The novel itself was well received, selling 170,000 copies in hardback and winning Tokarczuk a Nike award, very much the Polish equivalent of the Booker prize. But in a subsequent television interview Tokarczuk outraged right-wing Poles by saying that, contrary to its self-image as a plucky survivor of oppression, Poland itself had committed “horrendous acts” of colonisation at times in its history.

She received so many threats that her publisher was reportedly forced to hire bodyguards to protect her.

In 2018 she told The Guardian: “I was very naive. I thought we’d be able to discuss the dark areas in our history,” while also lamenting the fact that it took so long for some of her work to be translated into English.

“Sometimes I wonder how my life would have worked out if my books had been translated into English sooner, because English is the language that’s spoken worldwide, and when a book appears in English it is made universal, it becomes a global publication.”

Tokarczuk revisits the theme of transition in her most recent book to be published in English, Drive Your Plow Over the Bones of the Dead (first published in Polish in 2009 as Prowadź swój pług przez kości umarłych).

The main character, Janina Duszejko, lives near the Czech Republic and criss-crosses the border repeatedly.

"It gave me pleasure, because I could remember the time when it wasn’t possible. I love crossing borders. "

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LIFESTYLE

Yugoslavia's Black Wave: Still relevant Emerging Europe looks at the films of the Yugoslav Black Wave, work which transcends borders and time.

WR: Mysteries of the Organism

WORDS PORTIA KENTISH

R

estrained by the cliched post-communist lens, the Yugoslav Black Wave is a film movement often cast aside and overlooked. Its work is too frequently dismissed as only relevant to the Yugoslav era, the poeticised dissident artist struggling under communism, poverty and state repression.

However, to view such artwork through this lens is damaging not only to the artwork itself but also to the viewer, preventing ourselves from extracting our own reality. Zooming in on the work of pioneering filmmaker Želimir Žilnik, it becomes clear that the Yugoslav Black Wave movement is still strikingly relevant, transcending borders and time.

After Yugoslav leader Josip Broz Tito’s break from Joseph Stalin and the Soviet Union in 1948, a notable disintegration of cultural rigidity took place, replaced by an avant-garde nonalignment policy. This allowed an expansion of artistic realms, making the Yugoslav art scene one of the most experimentational and unconventional in the region.

It was this environment which fostered the birth of the Yugoslav Black Wave in the late 1960s.

Typically characterised by social criticism and dark humour, it is politically subversive and sexual redefining the standards of cinematic realism. It broke boundaries yet remained broadly unnoticed by the wider world. Notable directors include Mika Antić, Žika Pavlović, Krso Papić and Želimir Žilnik.

Some, of course, had success that crossed the Iron Curtain, notably Dušan Makavejev’s WR: Mysteries of the Organism which won acclaim from critics at Cannes. Other works were frequently nominated for Academy Awards and received wide praise overseas.

However, the freedom given to Black Wave artists was not unlimited. WR: Mysteries

of the Organism was banned in Yugoslavia and sent Makavejev into exile. Many others suffered the same fate due to the overt anticommunist tones of their work or for depictions of a pessimistic view of society and its development.

Validating individualism rather than collectivism was also cause for official displeasure.

Today, it is these same things which makes the work so poignant.

The Black Wave deals with a social realism we wish to ignore, the socioeconomic issues of everyday life. It deals with those whose lives are cast aside to the periphery of society, not only applicable to Yugoslav society at the time but any society at any time.

Želimir Žilnik is perhaps one of the movement's most notable and culturally relevant figures and a closer look at his short films will allow a glimpse into a wider narrative, warning of the dangers of ignoring works such as his. Žilnik’s 1971 Black Film is a 15-minute exploration into the state of homelessness. It opens with Žilnik saying: “These six people are homeless, in this film we try to find them accommodation” and proceeds to introduce the six men, all hopeless and disillusioned with the lack of state support.

This is contrasted with Žilnik introducing himself as well off, in a large apartment the state gifted him. He then lets the six men into

Žilnik’s 1971 Black Film

his flat, and asks the public what he should do with them.

Officials and citizens all respond with a similar answer: I don’t know or suggest vacant spaces such as the fish market or abandoned buildings for them to sleep in. The film ends with no fix, as “It is all the same”.

The film roll then abruptly runs out as he is showing the men out of his flat, as if a call to wake up.

While it would be easy to cast the film aside as a criticism of the shortcomings of the communist system this would be too simplistic.

It needs to be viewed as something broader, about a struggle for a society’s identity. As art historian Boris Buden puts it: “It is about society struggling with art for the true picture of itself, a society in the final struggle for its cultural survival”.

The film was made to go beyond Yugoslav society at the time and to a broader critique of liberalism, society and even art itself. At the beginning of the film Žilnik states “I made a similar film two years ago but it didn’t change anything”. Here, he is calling society’s bluff. The liberal ideal of the benevolent civil society helping the less fortunate find solutions, the artist bringing attention to pitfalls and making the periphery becoming culturally relevant.

This is all an illusion according to Žilnik. He is mocking the utopian light that does not reach the periphery of society, leaving those in blackness.

Similarly, his 1968 work Little Pioneers focuses on a group of young teenagers causing disruption, disillusioned with their place in society and often driven to stealing - another segment of society cast to the black. It shows the mistreatment towards them by police, authoritative figures and society in general. It ends with a mothers rage: “These are not normal kids, they are like cattle and should be taken to the reformatory”.

These themes are undoubtedly relevant to any culture, there is always an outer and a feeling of

powerlessness located within. Žilnik is disillusioned with the idea that art and benevolence can actually have a tangible impact. If he walked the streets of London or New York today asking that same question, What do I do with these homeless men? many would have the same answer - I don’t know.

The socially relevant commentaries of the Yugoslav Black Wave are often lost and cast aside. The films are victim to a post-communist lens that casts as a triumph of western liberalism against the failures of communism.

Unfortunately, this was the case not only for Yugoslav art but any art east of the Iron Curtain. Orientalist cliches and pre-existing stereotypes have prevented us from reaping the real benefit of the work. It is not necessarily a critique on the communist regime, but of society itself to which its characteristics are universal. Polish art historian Piotr Piotrowski warns against this perception of an “Eastern European” art history, but rather for it to be viewed as global.

For if there is anything that the Yugoslav Black Wave can teach us, it is cautioning us against the dismissal of artworks based on their context, for more often than not good art can penetrate through context to that of the universal. •

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LIFESTYLE

Želimir Žilnik

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LIFESTYLE

Life in Russian-occupied Crimea: What's changed?

Citizens across the Crimean peninsula, regardless of nationality and ideology, are trying to cope with the everyday struggles of life in a difficult environment that desperately needs to improve.

WORDS DOMINIK ISTRATE

W

hile the eastern Ukrainian war continues to shape public discourse in Europe and much of the world, less is known about the Crimean peninsula, which has now been a de facto part of the Russian Federation for five years, with Ukraine continuously calling for its return. After Russian forces occupied the region and staged a far-from-free referendum in March 2014, much has changed for those who are not satisfied with Crimea’s new rulers.

According to a recent report from the United Nations, major rights violations have occurred ever since Russia took over, affecting the basic human, political, civic and religious rights of local citizens. The UN claims that a number of planned events in support of the territorial integrity of Ukraine were prevented or prohibited “in ways that might potentially undermine the exercise of the freedoms of peaceful assembly and association.”

UN officials have also received information from local journalists that law enforcement authorities from Russia have interfered in their activities, leading to self censorship to avoid potential repercussions and entry bans issued

by the Russian foreign intelligence service, the FSB, against journalists who perceive Russia’s annexation of Crimea as occupation.

The report also noted that some Ukrainian churches with strong connections to Ukraine, including the Ukrainian Greek Catholic Church, faced difficulties with registration.

Enforced disappearance Since 2014, the UN has identified 42 victims of “enforced disappearance” in Crimea, of whom just 28 have been released after being abducted or detained illegally, with many of them being Ukrainian journalists, civil rights activists or affiliates of the Crimean Tatar community.

It is therefore increasingly clear that Russia has imposed the same authoritarian and oppressive lifestyle on Crimea that it imposes on mainland Russians.

“When I arrived in Crimea after a referendum, which the Kremlin poetically called ‘reunion with the homeland’ and the whole civilised world described with the simple word ‘annexation’, I expected with bated breath to feel what is it

like to be in the heart of the conflict, in the most discussed region of the world,” recalls Ekaterina, a Russian university student who regularly visits the peninsula. She comes to realise, however, that “it seemed that the whole world was discussing changes in Crimea, except Crimea itself.”

She says that everyday conversation in Crimea is mostly about financial affairs, salaries, how shops are named and what the construction of the enormous Kerch Strait Bridge could bring, something she believes resembles “the usual gossip of people after a new governor has been appointed”. These are not the heated discussions of an event – Crimea's annexation - that seemed unprecedented in the 21st century, showing that what people really care about is how life will go on.

For many, the Kerch Strait Bridge, which the Russian president Vladimir Putin opened in May 2018, was a symbol of what Russia could bring for the region: locals were pleased to see that attention was paid to improving the place.

After the annexation, the Kremlin pledged 5.3 billion US dollars to Crimean infrastructure projects, the construction of roads and highways, as well as to increase local salaries.

“As in any life, there are positive and negative moments,” Ekaterina continues, pointing to the increase in local tourism and the region’s ‘cultural popularisation’ as the most visible improvements.

Russian cultural opportunities have grown due to the new leadership being Russian.

According to her, most people welcomed the changes, “but not because these changes came from Russia, but because finally the state, any state, was paying attention to the region. Most of the peninsula’s residents do not really wonder what the reasons behind

The sanctions and the 2014 conflict also hit Crimea as a tourist destination that was once one of the most popular for Ukrainians, and it suffers from the lack of revenue non-Russian tourists could bring.

Despite Russia’s wild claim that six million people visited the peninsula in 2018, Krymstat, Crimea’s own statistical office, said that the number of visitors during the first half of 2018 was below half a million, with most of them being Russian.

“It is much cheaper for people to relax, for example, in Turkey or the changes are, or how long they pays more attention to our problems in other comparable resorts than will last,” she says. and invests more in solutions is in Crimea. For the same money or She was surprised to notice that it better for us.” even cheaper, foreign resorts will was usual to see a variety of people provide much better service,” claims around her, including refugees from Things get harder Pavel, a Crimean-born university Ukraine’s war-torn Donbas region, student who now studies in Russia. talking about their destroyed homes While Russia continues to “I always considered Crimea and how they fled Ukraine. invest heavily in the occupied to be something separate, I “Around them gathered region and the presence of Russian love it precisely because of its an audience with sympathy on troops has its economic benefits beautiful nature, but I consider their faces. But, just a dozen for local businesses, the lack of it an absolutely undeveloped metres from them, was a group international investors is evident: region from an economic point of Ukrainians about to leave for the landscape is full of unfinished of view, due to the sanctions,” he Kyiv. And surprisingly, there was construction sites, many of which says. While he does acknowledge no hostility or aggression between have were abandoned after foreign new infrastructure such as the these two groups.” investors pulled out fearing further bridge and the newly renovated As she sees it, “one should not conflict. airport in Simferopol, he notes have high hopes that regular Business opportunities how underdeveloped the local Crimeans will support the became even narrower after infrastructure is and “whoever conversation about what is best for the EU imposed sanctions on has the opportunity to move them, Russia or Ukraine, and what not just Russia, but Crimea, somewhere from Crimea, will identity they belong to. In most too, significantly limiting trade eventually move.” cases, you will hear: ‘We are neither opportunities which ultimately Both Ekaterina and Pavel point Russians nor Ukrainians, we are meant that some products would to one other thing which negatively Crimeans, and the country that be harder to find. affects Crimeans: sanctions on travel. Those wishing to take a flight can only do so to and from Russia, as sanctions prohibit international airlines flying to Simferopol.

Unless that changes, Simferopol's newly renovated will be criminally underused, and Crimea's isolation will go on. •

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LIFESTYLE

Going vegan in Budapest WORDS CLAUDIA PATRICOLO

H

Napfenyes restaurant

ungary is often a synonym for meat. Delicious traditional dishes include the famous gulyás (beef soup), the Hortobágyi palacsinta (a savoury pancake fi lled with meat, usually veal), pörkölt (basically made of any meat you could think of, either beef, pork, lamb, chicken or liver cooked with onion, paprika and other spices), or töltött káposzta (a cooked cabbage fi lled with pork mince).

Just a few years ago, Budapest would have been a nightmare for all those on a plant-based diet. Today, following a more global trend, not only vegetarian but also vegan places are on the rise. The popular app Happy Cow, which provides sources of vegan, vegetarian and healthy food, lists no less than 155 places in the Hungarian capital, from street food to fancier and more elegant restaurants, from vegan burgers to meat-free reinterpretations of Hungarian classics. We have picked a few of our favourites…

Vexicana vegan tacos

Napfényes' Ferenciek tere 2, 1053 At Napfényes, in the downtown area of Pest, close to the Elizabeth Bridge, everything is made of purely vegan ingredients (without any meat, eggs or dairy products), the majority of which are grown organically. The restaurant strives to make its dishes as healthy as possible. Instead of using traditional wheat flour, white sugar, cocoa and bean coffee, they prefer spelt flour, cane sugar, carob and grain coffee.

Even the drinks are 100 per cent organic and alcohol-free. The à-lacarte menu includes traditional dishes such as a vegan version of stuffed cabbage, fi lled with seitan, brown rice, faux sausage, oatmeal and garlic Great Bistro Bank utca 6, 1054 The Great Bistro is a family-run restaurant, whose owners, Greta and Ákos, are husband and wife.

Greta is particularly well-known in Budapest as she was the hostess of the fi rst and only vegan TV cooking show in Hungary. She has

also published a 150-recipe book called Greta's Kitchen Vegan Lifestyle and Cookbook. The Great Bistro offers a unique selection of world-renowned and 100 per cent vegetarian specialties featuring Thai, French, Italian, Hungarian, Arabic, Persian, African and Mexican cuisine without the use of animal-based ingredients. For example, in the menu, you can fi nd a faux foie gras, made of lentils and mushrooms pate. The only flaw it closes at 4 pm.

Vexicana Dob utca 40, 1072 Who said that Mexican food can’t be vegan? Located in the Rácskert vegan garden, within the city’s Jewish District, Vexicana spoils people with signature chili non carne made from seitan ragout, spring onions, chili and soy cream. Quesadilla with bean hummus and smoked vegan cheese is also available. Vexicana doesn’t lack creativity and another dish you can find is called I am so corny, an amazing corn soup laden with coconut milk, coriander, popcorn and parsley.

51

Las Vegan’s burger

Vegan garden

LIFESTYLE

Las Vegan’s Dob utca 40, 1072 Another very tasteful place located in the Vegan garden is a meat-free burger track called Las Vegan’s. The most ordered choice is the Lord Seitan burger made of course - of seitan, cucumber, tomato and a vegan cheese that actually tastes like real cheese.

But Las Vegan’s is not only about burgers. Pizzas baked in the shape of a heart are also on offer and come with toppings such as seitan kebab, plant-based sausage and a mix of green herbs and vegetables. All accompanied by fresh and organic smoothies.

Vegazzi Paulay Ede utca 33, 1061 Italians can have their own vegan pizza. In 2018, Vegazzi was featured in the top 10 of Hungarian vegan restaurants by the national gastro magazine Magyar Konyha (Hungarian kitchen). Patience is the main ingredient for this delicious vegan Neapolitan pizza.

The dough takes more time to prepare (more than 48 hours), but as is so often the case, for good things, we have to wait.

Matrjoska Kroshka Baross utca 6, 1085 There is nothing more Russian than a matrjoska. Add some tiny crumbs (Kroshka) and you have the fi rst Russian vegan restaurant in Budapest. It goes without saying that the restaurant does not use anything of animal origin, except for honey in certain plates. Vegan versions of the most popular Russian dishes are also available, such as borsch, syrniki, pelmeny, Russian black bread. Everything is homemade, including the buns the vegan burgers go inside.

The owner, Natasa Juhász, owned a very popular Russian bistro that turned vegan as she did, following the philosophy: we only cook what our body really needs.

Matrjoska Kroshka buns

Naspolya Nassolda Káldy Gyula utca 7, 1061 And as the Romans used to say dulcis in fundo (at the end comes the dessert), Naspolya Nassolda is the perfect place for a piece of vegan cake. Naspolya recalls Napoli and its flavours while Nassolda has no meaning at all: as the owners say “we came with a name as innovative as our recipes.” Apart from the wine, everything in Naspolya Nassolda is homemade: from cakes to dried delicacies, from juices to morning granola. They also make their own almond milk, freshly prepared every morning from organic almonds.

Chef Réka likes to be inspired by new flavours combinations and she likes to work with unusual ingredients such as tonka beans, goji berries and agar. •

Naspolya Nassolda cakes

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LIFESTYLE

Emerging Europe’s top 10 ski resorts

Bansko, Bulgaria

Skiing in emerging Europe is not always perfect, and is rarely hasslefree, but these 10 resorts all have plenty to offer, usually at a fraction of the cost of their counterparts in Western Europe.

WORDS CRAIG TURP

Gudauri, Georgia

beginners and intermediates in a gorgeous setting below Mt Musala, the highest peak in the Balkans.

There are around 50 kilometres of slopes in all, usually immaculately groomed and served by a decent lift system (although note that access to the Markudjik ski area can sometimes be hampered by high winds closing the gondola lift).

Off-piste is limited however and there is very little to keep experts happy. The resort offers some great accommodation close to the slopes and myriad dining options. There are also some very lively pubs and clubs (indeed, the resort can at times be a bit too lively for some tastes), and it’s all just over an hour from the Bulgarian capital Sofia.

Good Avoid public holidays and you’ll have the place to yourself.

Bad It’s a long way from just about anywhere.

4. Jasna, Slovakia The largest ski area in Central Europe offers 50 kilometres of slopes on both sides of Mt Chopok, including some very steep couloirs on the north face and wide-open, easier tracks on the south side of the mountain. There is a large freeride area and expert skiers will find 1. Gudauri, Georgia plenty to keep them happy. SnowHigh in the Caucasus mountains, making machines cover most of the 122 kilometres from the Georgian slopes and ensure good cover until capital Tbilisi (the drive takes the end of April. Accommodation around two and a half hours), is spread over a number of small, Gudauri has been a favourite of Good satellite villages which means that skiers-in-the-know for a number of Easy access from Sofia, lively apres ski. the vast majority have quick access years. Offering almost 1,500 metres Bad to and from the slopes, but makes of vertical drop the resort is a Very little on offer for experts, apres lively apres ski difficult to find if dream for skiers of all abilities, ski too rowdy for some. you are in one of the more quiet with wide-open cruising for locations. Great ski school, but beginners and improvers, some 3. Bukovel, Ukraine costs are relatively high and the lift fabulous off-piste for powder fans One of the best-kept secrets on pass is one of the most expensive and Europe’s cheapest heli-skiing the emerging Europe ski-circuit in the region. for real adrenaline junkies. Our is the almost immaculate resort only complaint is that for what is of Bukovel. There are more than Good a purpose-built resort the layout 60km of pistes, and while the Largest ski area in Central Europe. can be awkward (a lot of the resort’s elevation is not the highest Easy access from Košice airport. accommodation is a long walk (the top lift reaches a modest Bad from the lifts), but most hotels and 1372 metres) the resort’s latitude Lift pass is the most expensive apartment complexes offer shuttle makes it one of the most snow-sure in the region. buses to and from the slopes. With in the whole region. What’s more, the exception of Georgian public all the slopes – most of which are 5. Bansko, Bulgaria holidays, crowds are unheard of and tree-lined and sheltered from the Bansko was a lively market queues for the lifts non-existent. elements – are equipped with town centuries before it became snow cannons for when nature a ski resort and its historic centre Good fails to supply enough of the white retains a charm unmatched by Incredibly cheap lift pass, highstuff. There is a good range of most ski resorts in the region. altitude skiing for all levels. accommodation, and prices are There is plenty to do off the Bad very cheap. Now the bad news. slopes – from visiting museums Very little apres ski, resort layout One of the reasons Bukovel has to shopping for handmade local means a fair bit of walking. remained something of a secret is artefacts – which makes it a perfect its inaccessibility. It is more than destination for larger groups 2. Borovets, Bulgaria four and a half hours drive from the which include non-skiers. The The slopes at Borovets are split nearest international airport, Lviv, pistes themselves (and there are over two separate ski areas, and and the roads in this part of world nearly 70 kilometres of them, most both offer long-ish runs good for are not the best. suited for intermediates) are all

Bovec-Kanin, Slovenia

7. Bovec-Kanin, Slovenia As locals will be the first to point out, you don’t merely come skiing in Slovenia, you come for a whole winter experience. After all, if there is a more picture postcard perfect place on earth than Lake Bled when covered in ice and snow, then I have yet to see it. Kranjska Gora is the country’s best-known, and Good largest resort, famous for the slalom Loads for non-skiers to do, perfect World Cup races held here each year for families and mixed groups. and superb cross-country tracks.

Bad In my opinion however, there is far The queue for the gondola lift better (and less crowded) skiing in the morning can be very long. to be had at the other ski centres in the country, particularly at 6. Kapaonik, Serbia Vogel near Bohinjska Bistrica and Kopaonik, on the border of Serbia Slovenia’s highest resort, Kanin, and Kosovo, offers 55 kilometres which now has direct access from of tree-lined pistes. Runs are quite the town of Bovec on the other side short but good fun, and there are of the Triglav National Park. This few crowds: the resort is very well being Slovenia, no resort (with designed and the lift system, which the exception, alas, of Bovec) is has seen much investment in recent much more than an hour’s drive years, including a new six-seat chair- from Ljubljana. lift, keeps queues to a minimum.

The highest slope barely tops Good 2000m, but snow cover is usually Picture postcard scenery. guaranteed until the end of March Bad (and even when there isn’t any All of Slovenia’s resorts can be snow, the resort boasts the longest very crowded. artificial ski slope in Europe, nearly a kilometre in length and served by 8. Kolašin 1450, Montenegro its own chairlift). Accommodation There are currently seven places to is good value, and there is plenty ski in Montenegro, and the country to choose from. Access, however, is keen to develop winter tourism is a problem: it’s almost five further. The largest, and best resort is hours from Belgrade, longer from currently Kolašin 1450, a 90-minute Podgorica. Prishtina is in theory far drive north from the country’s capital closer, but as you are not allowed Podgorica, generally snow-sure from to cross the border directly from December to April. With a modest Kosovo to Serbia, you need to go 20 kilometres of mainly gentle, via Montenegro. tree-lined slopes served by seven lifts (including a brand new chair-lift) Good the resort is currently off the radar Varied skiing with plenty for experts. of most European skiers, but that Bad could soon change. The Montenegrin Access is far from easy. government has high hopes for winter sports: an entirely new resort is being built further up the mountain at Kolašin 1600, which will increase bed capacity (currently there are few accommodation options), and tens of millions are currently being spent on creating what will be the largest ski area in the Western Balkans, all part of a major plan to develop the Bjelasica region. high altitude and made snow-sure by a sophisticated snow-making system. The downside is that access to the ski area from the town is via a gondola lift for which the queues are the stuff of legend. Waiting an hour is not unheard of at the wrong time of day (between 10am and midday). Get there early.

Kapaonik, Serbia

Good You’ll possibly be the only foreigner in the resort.

Bad Little for experts.

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9. Zakopane, Poland Poles are crazy about ski jumping, and Zakopane in the Tatras is the country’s ski jumping capital.

Competitions are held all winter, the highest calibre being the World Cup event which takes place at the end of January. Alas, when it comes to more conventional skiing, you will almost certainly leave Poland with the impression that it could be fantastic, if only they could get their act together. Zakopane is a good base for exploring a number of different ski areas, of which the closest (and biggest) are Kasprowy Wierch and Gubałówka, on either side of the town centre. The two areas are not connected however, and despite the recent installation of new chair-lifts, the crowds and lift queues remain a turn off. Zakopane does have plenty to offer away from the slopes, however, including great food and drink, and for groups and families including non-skiers, it’s a superb choice.

Good Great place to watch ski jumping.

Bad Long queues, main ski areas not connected.

10. Sinaia, Romania In a parallel universe Sinaia is the best place to ski in emerging Europe, not the 10th best. In that universe one company operates the ski lifts (instead of two in the real world) and only one far-from-cheap lift pass is needed. In that universe high winds do not close the lifts and there is reliable snow (Romania, contrary to popular belief, has relatively dry winters). If you get lucky and catch Sinaia on a sunny day, with good snow and no crowds, then it can be easy to think that you are in that parallel universe. Alas, such days are few and far between.

Enjoy them – if you can. •

Good Lots to do off the slopes, especially the tour of gorgeous Peles Castle.

Bad Two lift passes needed, unreliable snow, crowded at weekends.

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Holidays behind the Iron Curtain

On a 1989 trip to the Bulgarian ski resort of Borovets, Emerging Europe editor Craig Turp bought a large hotel's entire stock of Pepsi. It made him realise that a planned economy could never work.

WORDS CRAIG TURP

T

ourists from Western Europe travelling behind the Iron Curtain before its fall in 1989 could broadly be separated into three distinct groups: those attracted by the cheap prices; those fascinated to take a look at a communist society; and those who were left-wing sympathisers of the communist regimes (usually called fellow travellers or – less kindly – useful idiots).

I was part of the first group.

For Eastern Europe, as it was known back then, was unquestionably cheap. In an era when low-cost, no-frills airlines were unheard of, travel to just about anywhere was relatively expensive. Eastern Europe was an exception. Skiing holidays in particular could be bought for less than half of the cost of a sojourn in France, Austria or Switzerland, and while the skiing was nowhere near as extensive as that offered by the Alps, for those of us hardy enough to put up with appalling food and customer service the Carpathians and the Balkans provided a way of pursuing our love of going downhill without

placing our financial well-being for the rest of the year in jeopardy.

It was the incredibly low cost of one such package skiing holiday that brought me to the resort of Borovets in Bulgaria, at the end of January 1989. Just 16, I travelled with my now sadly-departed brother, who was several years older but was a good sport and had for some time allowed his annoying younger sibling to tag along when he went skiing with his friends.

We stayed at the Rila hotel, recently opened and something of a showpiece not just for Borovets but for Bulgaria itself.

The food was edible, the rooms comfortable and there was a rather tawdry nightclub complete with floorshow of questionable taste.

The ski lifts were new, the pistes well-prepared and it was all rather agreeable. The only real sign that perhaps the Bulgarian economy was not quite up to scratch was the fact that local money could buy you very little.

There were two shops in the hotel: one relatively wellstocked but accepting only foreign currency and charging high prices,

and another, far less well-stocked, which was far cheaper but took only Bulgarian leva.

One morning, having stupidly changed much of our hard currency into leva (blinded by the generous black market exchange rates offered by our ski instructor) we enquired at the Bulgarian shop if there was any Coke or Pepsi available. “Not until Wednesday,” we were told.

“There will be a delivery of Pepsi then. But you will need to be quick, it sells out fast.”

One of our group, a market trader, then asked the manager of the shop how much a bottle of (at that stage purely theoretical) Pepsi cost. I don’t recall the amount, but it was very, very cheap. Why is it so cheap?

He asked. Because that’s the price set by the government, was the reply. We offered there and then to buy every bottle of Pepsi that was delivered at double the retail price if the manager would keep them for us.

The manager agreed.

Come Wednesday, the six of us took delivery of 24 crates of Pepsi, which we carried to our rooms.

We spread word that we had all the hotel’s Pepsi and would sell it at double the price we had paid for it (still far cheaper than in the hard currency shop) but would accept only dollars or UK pounds. By the end of the day we had sold out.

The shelves of the leva shop were devoid of Pepsi, but our pockets were full. We had done well, and the free market had once again triumphed over the planned economy.

If ever you need a story to describe why communism failed: there’s one.

Not that leva was entirely without value in communist Bulgaria. While most things had to be bought in hard currency, some places accepted leva. One of these was, incredibly, the best restaurant in the country: a Japanese teppanyaki establishment in the basement of the New Otani hotel in Sofia (now the Marinela),

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to where we decamped one evening.

For the equivalent of less than 15 UK pounds (I kid you not) six of us feasted like Japanese royalty before heading to the dollars-only casino at the Sheraton (now the Sofia Hotel Balkan; and yes: communist Bulgaria had casinos). Underage, I was (fortunately) forced to sit in the lobby while my companions lost just about all the money they had made in the Pepsi caper.

If ever you need a story to describe why you should never go to a casino: there’s one.

My other abiding memory of that holiday was just how relaxed the locals were. These were not the cowed eastern Europeans living in a constant state of fear we had expected. They were more than willing to talk about the country and its problems. Certainly, Bulgaria at the time was far more open than Albania, Romania or East Germany, but it was still a one-party state whose rulers had little idea that the end of their regime was nigh.

Indeed, to a naive schoolboy life in communist Bulgaria looked good, not least one afternoon when a group of local kids turned up for a skiing lesson. “For kids who live in Samokov [the nearest town to Borovets] skiing is on the school curriculum,” I was told by my ski instructor. I was impressed, and tempted to move to Samokov as soon as possible.

Of course, ski resorts have never been the best place to accurately

gauge a country’s well-being, which is why the second group of western travellers tempted by holidays behind the Iron Curtain – those drawn by a sheer fascination of what life was like – often left disappointed that they had not had the full communist experience.

Except, that is, for a group of Scottish tourists who visited the Romanian ski resort of Poiana Brașov just a few weeks after we had been in Borovets.

On the afternoon of March 2, 1989, Liviu Babeș, a 47-year old man from Brașov, walked on to Poiana’s Bradul ski slope and shouted “Living in Romania is like living in Auschwitz” (or words to that effect) and in front of the horrified Scottish tourists set himself alight. He died in hospital later the same day.

Romanian dissident Ion Ratiu’s Free Romanian newspaper,

published in London, in April 1989, called Babeș The Jan Palach of Romania. Alas, Palach is far better remembered. (Not that Babeș is entirely forgotten: the story made newspapers worldwide, although not, unsurprisingly, in Romania, and Babeș has every right to be considered one of the first martyrs of the Romanian revolution. There is a memorial to his heroism in Poiana Brașov, close to the spot where he set himself alight, and a street in Brașov is named after him. There are also plans to raise a statue of him in the city).

Of course, the fellow travellers would no doubt have put the actions of Babeș down to those of a crazed lunatic rather than a true reflection of just how awful life in communist Romania actually was.

It’s why the term useful idiots described them so well. •

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A postcard from the Romania-Bulgaria border WORDS CRAIG TURP

N

ews in October that Bulgaria had met the European Commission's criteria for the lifting of the Cooperation and Verification Mechanism (CVM) and - implicitly - entry into the Schengen group of border-free countries was met with mixed feelings on both sides of the Danube.

The CVM has been used by the Commission since 2007 to assess Bulgaria and Romania in the areas of judicial reform, the fight against corruption, and – in the case of Bulgaria – organised crime.

In its latest progress report the Commission notes that Bulgaria has worked consistently on the implementation of recommendations made in a previous report published in November 2018, and that it has seen consolidation of the legal and institutional framework put in place over previous years. Romania, however, has gone backwards.

The report was scathing in its criticism of the country’s government, which it claims has backtracked from the progress made in previous years. While Schengen membership is now a real possibility for Bulgaria in the very near future, Romania looks set for an extended wait. This impacts both countries.

Without Romanian Schengen membership, Bulgarians will have only limited access to the borderfree travel zone. While there would no longer be any passport checks for passengers flying to and

have a physical border between them is in itself an anomaly, and increasingly rare. Earlier this summer I drove from Portugal into Spain. Crossing the border meant driving over a bridge, nothing more. I did not even have my passport with me.

While my feelings for longdistance lorry drivers are usually less than favourable (the way that they hog the road, especially on single-carriageways, is both annoying and dangerous), whenever I arrive at the RomaniaBulgaria border I immediately become endlessly sympathetic for from Bulgarian airports to cities their plight. in other Schengen member states, While cars can cross in an hour nor would there be any checks or so, lorries are made to wait far at the Bulgarian-Greek border, the bottleneck that is the Bulgarian- longer: long lines of trucks, bound for foreign markets and no doubt Romanian border would be packed with goods that customers unchanged. The long queues at the Giurgiu-Ruse crossing point, which are patiently awaiting extend for kilometres on either side of the can add over an hour to the fivehour drive from Sofia to Bucharest, border. The amount of money lost by firms whose products are trapped would still be in place. Bulgarians in these pointless queues must driving to Hungary, Austria, be enormous.

Germany or beyond would still I have long believed that queues face having to show their passports - any queue, be it at a border or at least twice during the trip. in a supermarket - is the result of I make the journey across the a badly designed system. Certainly, Romania-Bulgaria border several the systems in place at Giurgiutimes a year. Sometimes to visit Ruse could be more efficient. There Bulgaria, either for business or for short breaks, and on other occasions could be more passport control points for a start, and the tax which while travelling to Greece. needs to be paid to use the bridge The drive is usually pleasant - not least as Bulgaria has opened several that connects the two cities could new sections of motorway in recent be paid by SMS, as opposed to stopping in order to hand over cash times - but the thought of queuing (payment cards are not accepted). up at Giurgiu-Ruse (or at Vama But the best way to remove Veche, another bottleneck, pictured the queue at the Romania-Bulgaria above) always fills me with dread in the days that precede departure. border (and indeed the RomaniaHungary border, where there It used to be the case that if you are similar problems) would be were an early bird and arrived for both countries to become at the border before 6am, the Schengen members. With a new worst of the congestion could be government in place, Romania avoided. Over the last year or two however, the number of Romanians will now hopefully make up for its backsliding in recent years - and heading south - especially during will do so fast. the summer - has increased It should view every driver - and significantly, and with it the amount every passenger - forced to wait at of time it takes to cross the border, the border as a potential lost vote. at any hour of day or night.

There are hundreds of thousands That two member states of the European Union should still perhaps even millions - of us. •

Kyiv vs. Kiev is not a fixture in the Ukrainian Premier League WORDS JERRY CAMERON

U

kraine has been in the headlines a great deal these past few months, and not always for the right reasons. Caught in the midst of an almighty row that that could well spell the end of Donald Trump’s presidency, the country can at least take solace in the fact that major news organisations are finally - and not before time - beginning to learn how to spell the name of its capital.

A number of global news agencies and media outlets have recently adopted the Ukrainian-language derived Kyiv as their official spelling for the country’s capital city, replacing the Russian version, Kiev.

The trend began in August when the Associated Press announced that it was adopting Kyiv. Since then, the Wall Street Journal, the Washington Post and the BBC have all followed suit (although we noted that in one recent story the Wall Street Journal still used Kiev in a photo caption. Clearly the photo editor did not get the memo...)

There are still a few notable exceptions however, not least Reuters.

At Emerging Europe we have always used the Ukrainian version of the city’s name, and we do so not to make any political points but for the same reason we use Tallinn and not Tallin, or Chișinău instead of Kishinev.

Kiev, Tallin or Kishinev should be used in the same way that we use Rim (the Russian name for Rome): not at all.

Russia was for many decades (and even centuries) a colonial power in Ukraine, Estonia and Moldova.

To use the colonial name for a city is not just incorrect, it’s disrespectful.

“This rush to Ukrainianise spellings is not only a response to Kyiv’s sudden newsworthiness.

It represents the latest chapter in a long-running campaign to secure recognition for the Ukrainianlanguage versions of Ukrainian place names, and is part of a much broader post-Soviet drive to assert an independent Ukrainian identity,” says Peter Dickinson of the Atlantic Council.

“These efforts have not always met with success. For example,

the Ukrainian authorities first endorsed Kyiv as the official English-language spelling back in the mid-1990s, but beyond the rarefied world of diplomatic protocol, most members of the international community paid no attention and continued with the more familiar Kiev instead.”

Finally, while we are on the subject of Ukrainian nomenclature, its perhaps worth remembering that it’s simply Ukraine, not The Ukraine, as the country’s embassy in Washington had to remind Mr Trump in September.

Indeed, one young Ukrainian student we spoke to recently said that for her at least, use of The Ukraine was actually a far bigger deal than persisting with Kiev.

“Kiev is just the Russian transliteration,” she told Emerging Europe. “The Ukraine is a whole lot worse: it’s grammatically incorrect.” •

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