Tag: Ukraine

EU Accession and Sustainability Challenges for Ukraine’s Agricultural Sector

Posted on November 18, 2024 | Policy Brief

Combine harvester in a Ukrainian wheat field symbolizing EU accession impacts on agriculture.

Recently the EU opened accession negotiations for Ukraine. Apart from the trade benefits of having access to a large and wealthy EU market, Ukraine’s agricultural producers in particular, will have to comply with and implement a complex and demanding EU acquis in agriculture. Together with the Common Agricultural Policy, this includes regulation of markets and standards in farming practices, animal and plant health, food safety, and environmental and animal welfare. The potential additional compliance costs from EU accession may undercut Ukraine’s agricultural competitiveness and supply growth, crucial for feeding a growing population. However, in this policy brief, we show that these costs are not critical and that there is a potential for agricultural producers to simultaneously increase their output and contract harmful environmental impacts, which in turn can compensate for the additional compliance costs.

Introduction

The European Council granted Ukraine candidate status in June 2022 and eventually opened accession negotiations in December 2023. For the Ukrainian agricultural sector, an EU membership would bring trade benefits from having access to a large and wealthy EU market. At the same time, Ukraine would have to comply with a complex and demanding EU Acquis in agriculture (hereafter called EU agricultural acquis). This, together with the EU Common Agricultural Policy (CAP), includes regulation of markets and standards in the areas of farming practices, animal and plant health, food safety, and environmental and animal welfare (Nivievskyi, 2024).

Complying with these regulations would entail additional costs for agricultural producers, raising concerns about the comparative advantage of Ukrainian agriculture. If these effects are strong enough, it could, in turn, hamper Ukraine’s agricultural supplies growth, crucial for feeding a growing global population.

While the evidence on the expected compliance costs is very scarce (see e.g. EU Commission, 2014), it shows they would be in the range of up to an additional 10 percent of the total costs. This cost increase, however, does not seem to ruin Ukraine’s comparative advantage in agriculture. Moreover, in this policy brief, we demonstrate that producers of grains and oilseeds in Ukraine have the potential to improve their efficiency by increasing their output by almost 20 percent and simultaneously contracting harmful environmental impacts by 16 percent. Such improvements can compensate for additional EU agricultural acquis compliance costs for Ukraine’s agricultural producers.

Relevance

Ukraine’s agricultural sector plays a key role domestically and internationally. It is noticeably dominated by crops, mainly by highly competitive grains and oilseeds. Agriculture alone accounts for about 10 percent of Ukraine’s GDP, but together with upstream (e.g. agricultural machinery) and downstream (e.g. food processing) industries, the entire agri-food sector’s share amounts to roughly 20 percent of GDP. The agri-food sector accounted for 60 percent of Ukraine’s total exports in 2023 with Ukraine’s shares in global corn and wheat trade reaching almost 20 and 10 percent, respectively.

At the same time, agriculture is among the top five sectors of the Ukrainian economy contributing to Nitruos Oxide (N2O) emissions in the country (SSSU, 2018). Since it generates not only desirable outputs but also environmentally undesirable ones (such as GHG emissions, pollution from applied chemical fertilizers and pesticides etc.), the negative outputs should be both considered in the assessment of the sector’s performance.

The existing empirical literature places the main focus on the economic aspects of the agricultural sector’s performance in Ukraine, more specifically on technical efficiency and total factor productivity. A recently published study (Halytsia, Vrachioli, Nivievskyi, Sauer, 2024) we undertake the first attempt to incorporate undesirable outputs of agricultural production in the analysis of Ukrainian agricultural producers’ efficiency and provide empirical evidence on how they perform from a combined economic and environmental perspective. This policy brief summarizes the study’s results.

Data and Methodology

To estimate the environmentally adjusted efficiency of crop producers, we use farm-level accounting data from 2017-2019, collected by the State Statistics Service of Ukraine. The analysis is conducted for cereals (including wheat, barley, maize and others) and sunflower production since they are the major crops in terms of sowing land and output shares and given their importance for Ukrainian agricultural export.

To account for both desirable and undesirable outputs of crop production (environmental bads in our study are N2O emissions originating from the usage of mineral fertilizers and CO2 emissions from fuels’ consumption), the production technology is formalized in the form of a hyperbolic distance function. This gives the maximum linear expansion of a desirable output vector and contraction of an undesirable output vector for a given input vector. Parametric estimation (deploying a so-called stochastic frontier model) of the distance function yielded hyperbolic efficiency estimates that reflect the producers’ ability to expand good outputs and simultaneously contract environmentally undesirable ones to achieve maximum environmentally adjusted economic efficiency.

Empirical Results

The results from the econometric analysis reveal that the average environmentally adjusted economic efficiency estimate for crop producers in Ukraine is 0.84 (efficiency estimates are bounded between 0 and 1). This suggests that, on average, producers of cereals and sunflowers in Ukraine can improve their production results by increasing crop output by 19 percent (1/0.84 = 1.19) while simultaneously contracting undesirable output by 16 percent (1–0.84 = 0.16) in order to be fully efficient, i.e. have their output level on the frontier of the production technology (Figure 1).

The obtained environmentally adjusted economic efficiency level is fairly comparable to the efficiency values estimated in empirical studies for crop producers in other Eastern European countries, more specifically Poland (Gołaś et al, 2020; Stępień et al., 2021).

Figure 1. Graphic synthesis of the study’s findings

Source: Authors’ presentation.

Policy Implications and Recommendations

Performance Improvement

The results from the empirical analysis show that there is room for Ukrainian crop farmers to improve their environmental and economic performance. The following policy interventions can be helpful in facilitating this improvement:

  • establishing clear standards for the quality of chemical fertilizers, promoting organic ones and robust agrochemicals management and monitoring systems
  • promoting the adoption of climate-smart agricultural technologies, such as, for instance, fertigation (which can be especially effective in the steppe agro-climatic zone where most Ukrainian crop production is concentrated and which is noticeably affected by changing climatic conditions)
  • governmental programs for energy saving in agriculture to help reduce the amount of farm CO2 emissions.

Implementation of these measures can contribute to closing the efficiency gap, bring more sustainable agricultural production growth and help farmers compensate for the anticipated costs of EU legislation compliance regarding environment, animal welfare, and food safety.  The latter, in turn, entails not only costs but also a number of benefits. Potential benefits from implementing environmental regulations are, for instance, input savings ( e.g. in fertilizer or pesticide costs), additional revenues (higher prices and increased consumer demand for agricultural products produced sustainably) and extension programs financed through public funds (Mettepenningen et al., 2009).

Data Collection Improvement

Key limitations of this study stem largely from issues related to data availability. More specifically, there is no data available on organic fertilizer application, specification of the types of used pesticides, or details on farm characteristics (such as farm economic size, land type, environmental subsidies, etc.). These data would enable a robust and comprehensive estimation of the environmentally adjusted economic efficiency of agricultural producers, accounting for a broader range of undesirable outputs and incorporating determinants of inefficiency into the analysis.

Currently, the State Statistics Service of Ukraine’s annual statistical survey forms do not contain questions which enable the collection of the above mentioned data. Enhancing farm-level data collection will be necessary to align Ukrainian statistical databases with Eurostat, given Ukraine’s candidate status for EU membership.

The importance of collecting data on farms’ environmental performance is supported by the ongoing transition in the EU from a farm accountancy data network to a farm sustainability data network, which aims to collect rich microeconomic data not only on farms’ income and business activities but also information on their environmental and social sustainability performance.

Conclusion

Over the two decades prior to Russia’s unprovoked full-scale invasion, Ukraine developed into an increasingly important global supplier of staple food.

In this policy brief, we quantify the improvement potential for the performance of crop producers in Ukraine from both economic and environmental perspectives and highlight that potential efficiency improvement could compensate for the additional EU agricultural acquis compliance costs that Ukraine’s agricultural producers are expected to face upon Ukraine becoming a full EU member.

Acknowledgment

This policy brief is based on the academic article Assessing the Environmental Performance of Agricultural Production Using a Parametric Approach: An Application for Crop Producers in Ukraine by Olha Halytsia, Maria Vrachioli, Oleg Nivievskyi and Johannes Sauer, published in Eastern European Economics.

References

Disclaimer: Opinions expressed in policy briefs and other publications are those of the authors; they do not necessarily reflect those of the FREE Network and its research institutes.

Active Labor Market Policy in the Baltic-Black Sea Region

Posted on June 3, 2024 | Policy Brief

Image that shows an overhead view of a large, open pedestrian area with people walking and standing around representing active labour market policy.

This brief outlines the characteristics of active labor market policy (ALMP) in four countries in the Baltic-Black Sea region: Belarus, Lithuania, Poland, and Ukraine. An analysis of the financing expenditure structure within this framework reveals significant differences between the countries, even for Poland and Lithuania, where the policies are to be set within a common EU framework. Countries also differed in terms of their ALMP reaction to the economic challenges brought about by the Covid-19 pandemic, as Poland and Lithuania increased their ALMP spending, while Ukraine, and, especially, Belarus, lagged behind. Despite these differences, all four countries are likely to benefit from a range of common recommendations regarding the improvement of ALMP. These include implementing evidence-informed policymaking and conducting counterfactual impact evaluations, facilitated by social partnership. Establishing quantitative benchmarks for active labor market policy expenditures and labor force coverage by active labor market measures is also advised.

Introduction

This policy brief builds on a study aimed at conducting a comparative analysis of labor market regulation policies in Belarus, Ukraine, Lithuania, and Poland. In comparing the structure of labor market policy expenditures, the aim was to identify common features between Poland and Lithuania, both of which are part of the EU and employ advanced labor market regulation approaches. We also assessed Ukraine’s policies, currently being reformed to align with EU standards, contrasting them with Belarus, where economic reforms are hindered by the post-Soviet authoritarian regime.

The analysis of the labor market policies for the considered countries is based on an evaluation of the structure of pertinent measures between 2017 and 2020 (Mazol, 2022). We used the 2015 OECD systematization of measures of active labor market policy, as presented in the first column of Table 1.

Our study reveals substantial differences in active labor market policies within the four considered countries. Still, motivated by OECD’s approach to ALMP, we provide a range of common policy recommendations that are relevant for each country included in the study. Arguably, aligning with the OECD approach would have more value for current EU and OECD members, Poland and Lithuania, and the aspiring member, Ukraine. However, these recommendations also hold value when considering a reformation of the Belarusian labor market policy.

ALMP Expenditures in Belarus, Lithuania, Poland and Ukraine

Labor market policy comprises of active and passive components. Active labor market policy involves funding employment services and providing various forms of assistance to both unemployed individuals and employers. Its primary objective is to enhance qualifications and intensify job search efforts to improve the employment prospects of the unemployed (Bredgaard, 2015). Passive labor market policy (PLMP) encompasses measures to support the incomes of involuntarily unemployed individuals, and financing for early retirement.

Poland and Lithuania are both EU and OECD members, so one would expect their labor market policies to be driven by the EU framework, and, thus, mostly aligned. However, our analysis showed that the structure of their expenditures on active labor market policies in 2017-2019 differed (Mazol, 2022). In Lithuania, the majority of the funding was allocated to employment incentives for recruitment, job maintenance, and job sharing. From 2017 to 2019, the share for these measures was between 18 and 28 percent of all expenditures for state labor market regulation. In Poland, the majority of funding was allocated to measures supporting protected employment and rehabilitation. The spending on these measures fluctuated between 23 and 34 percent of all expenditures for state labor market regulation between 2017 and 2019.

The response to the labor market challenges during the Covid-19 pandemic in Poland and Lithuania resulted in a notable surge in state labor market policy spendings in 2020, amounting to 1.78 percent of GDP and 2.83 percent of GDP, respectively. Both countries sharply increased the total spending on employment incentives (see Table 1 which summarizes the expenditure allocation for 2020). Poland experienced a nine-fold increase in costs for financing these measures (29.4 percent of total expenditures on state labor market regulation). Meanwhile, in Lithuania, financing for employment incentives increased more than tenfold, amounting to 42.5 percent of all expenditures for state labor market regulation. In both countries it became the largest active labor market policy spending area.

Table 1. Financing of state labor market measures in Baltic-Black Sea region countries in 2020 (in millions of Euro).

Source: DGESAI, 2023. Author’s estimations based on World Bank data (World Bank, 2023), National Bank of Belarus data, National Bank of Ukraine data.

In Ukraine, the primary focus for active labor market policy expenditures was, from 2017 to 2020, directed towards public employment services, comprising 18 to 24 percent of total labor market policy expenditures. Notably, despite the Covid-19 pandemic, there were no significant changes in either the structure or the volume of active labor market policy expenditures in Ukraine in 2020. Despite Ukraine’s active efforts to align its economic and social policies with EU standards, the government has underinvested in labor market policy, with expenditures accounting for only 0.33-0.37 percent of GDP between 2017 and 2020. This is significantly below the levels observed in Lithuania and Poland.

In Belarus, labor market policy financing is one of the last priorities for the government. In 2020, financing accounted for about 0.02 percent of GDP, amounts clearly insufficient for having a significant impact on the labor market. Moreover, Belarus stood out as the sole country in the reviewed group to have reduced its funding for labor market policies, including both active and income support measures, during the Covid-19 pandemic. The majority of the financing for labor market policy has been directed towards protected and supported employment and rehabilitation, including job creation initiatives for former prisoners, the youth and individuals with disabilities.

ALMP Improvement Recommendations

As illustrated above, the countries under review do not have a common approach to active labor market policy spendings. Further, countries like Poland and Lithuania took a more flexible stance on addressing labor market challenges caused by the Covid-19 pandemic, by implementing additional financial support for active labor market policies. However, Ukraine and Belarus did not adjust their expenditure structures accordingly. Part of these cross-country differences can be attributed to differing legal framework: Poland and Lithuania are OECD and EU member states, and, thus, subject to corresponding regulations. Ukraine is in turn motivated by the prospects of EU accession, while Belarus currently has no such prosperities to take into account.

Another important source of deviation arises from the differences in current labor market and economic conditions in the respective countries, and the governments’ need to accommodate these. While such a market-specific approach is well-justified, aligning expenditure structures with current labor market conditions necessitates obtaining updated and reliable information about the labor market situation and the effectiveness of specific labor market measures or programs. An effective labor market policy thus requires establishing a reliable system for assessing the efficiency of government measures, i.e., deploying evidence-informed policy making (OECD, 2022).

To achieve this, it is crucial to establish a robust system for monitoring and evaluating the implementation of specific measures. This involves leveraging data from various centralized sources, enhancing IT infrastructure to support data management, and utilizing modern methodologies such as counterfactual impact evaluations (OECD, 2022).

Moreover, an effective labor market regulation policy necessitates the ability to swiftly adapt existing active measures and service delivery methods in response to changes in the labor market. This might entail rapid adjustments in the legal framework, underscoring the importance of close cooperation and coordination among key stakeholders, and a well-functioning administrative structure (Lauringson and Lüske, 2021).

To accomplish this objective, it is vital to foster close collaboration between the government and institutions closely intertwined with the labor market, capable of providing essential information to labor market regulators. One of the most useful tools in this regard appears to be so-called social partnerships – a form of a dialogue between employers, employees, trade unions and public authorities, involving active information exchange and interaction (OECD, 2022).

A reliable system to assess labor market policy and in particular to facilitate their targeting, is an essential component of this approach.

Ukraine and Belarus are underfunding their labor market policies, both in comparison to the levels observed in Poland and Lithuania, and in absolute terms. It is therefore advisable to establish quantitative benchmark indicators to act as guidance for these countries, in order to ensure that any labor market policy implemented is adequately funded. Here, a reasonable approach is to align the costs of implementing labor market measures with the average annual levels for OECD countries (which are 0.5 percent of GDP for active measures and 1.63 percent for total labor market policy expenditures (OECD, 2024). Furthermore, it’s essential to ensure a high level of labor force participation in active labor market regulation measures. A target standard could be set, based on the average annual coverage from active labor market measures, at 5.8 percent of the national economy labor force, as observed in OECD countries (OECD, 2024).

Conclusion

The countries under review demonstrate varying structures of active labor market expenditures. Prior to the Covid-19 pandemic, employment incentives received the most financing in Lithuania. In Poland the largest share of expenditures was instead directed to measures to support protected employment and rehabilitation. In Ukraine, the main expenditures were directed towards financing employment services and unemployment benefits while Belarus primarily allocated funds to protected and supported employment and rehabilitation. Notably, Lithuania and Poland responded to the economic challenges following Covid-19 by significantly increasing spending on employment incentives, while Ukraine and Belarus did not undertake such measures.

Part of the diverging patterns may be attributable to the countries varying legal framework and differences in the countries respective labor market and economic conditions.

While some of the differences in labor market policies are thus justified, ensuring funding at the OECD level for labor market measures, alongside adequate tools for monitoring and evaluating labor market policies, are likely to benefit all four Baltic-Black Sea countries.

References

Disclaimer: Opinions expressed in policy briefs and other publications are those of the authors; they do not necessarily reflect those of the FREE Network and its research institutes.

Can Farmland Market Liberalization Help Ukraine in its Reconstruction and Recovery?

Posted on March 20, 2024 | Policy Brief

20240319 Farmland Market Liberalization Ukraine Image 01

The Russian full-scale invasion of Ukraine has inflicted massive damages and losses on Ukraine, already amounting to more than 2.5 times Ukraine’s 2023 GDP. Despite substantial and continuing international political and financial support to help Ukraine in its recovery and reconstruction, it is becoming increasingly clear that it will need to mobilize its own resources and private financing as well – not just for the country’s reconstruction but also for its long-term development. From a government perspective, it is important for Ukraine to leverage scarce public and donor resources and to undertake necessary reforms to facilitate and crowd in private financing. Farmland market liberalization is one of the key reforms in this respect. Its scale, with farmland accounting for more than 70 percent of Ukraine’s territory, and capacity for private financing generation for agriculture and rural areas is, however, often underestimated.  

An Unbearable War Toll and the Need for Private Financing

The raging Russian war on Ukraine enters its third year, imposing an immense toll in terms of human life, economic stability, and regional security. About 20 percent of Ukraine’s territory has been occupied. More than 10 million Ukrainians have left their homes, including 6.45 million refugees that have resettled across Europe (UNHCR, 2024). Ukraine’s military casualties are reported to be approaching 200,000 (The New York Times, 2023) and at least 10,000 civilians have been killed (United Nations, 2023). Ukraine’s GDP plunged by 30 percent in 2022, and the documented total damages to Ukraine’s economy have reached US$ 155 billion, as of January 2024 (KSE, 2024). Similarly, economic losses amount to around US$ 500 billion (as of December 2023). At the same time Ukraine’s reconstruction and recovery needs are estimated at about US$ 486 billion (World Bank, 2024). This immense number make up more than 2.5 times Ukraine’s 2023 GDP.

While there is a substantial and continuing international political and financial support for Ukraine’s defense, recovery, and reconstruction, this will not be enough (World Bank, 2023). Ukraine needs to mobilize its own resources and private financing, not just for its reconstruction but also for its long-term development. The Ukrainian government must leverage scarce public and donor resources and undertake necessary reforms to facilitate and crowd in private investments. One of the crucial reforms in this regard is the ongoing liberalization of the farmland market. The scale of its impact and capacity to generate private financing for agriculture and rural areas is frequently undervalued.

Ukraine’s Farmland Market and Reform

Almost 71 percent of Ukraine’s territory (or 42.7 million ha, including occupied territories) is farmland and 33 million ha is arable. This is far more than in the largest countries in the EU. Ukraine also has one-third of the world’s most fertile black soils. This resource has however been heavily underutilized for agricultural and overall economic development (KSE, 2021). Over the last two decades, Ukraine has turned into an increasingly important global supplier of staple foods (von Cramon-Taubadel and Nivievskyi, 2023), but this has largely happened without a full-fledged farmland market in Ukraine capable of facilitating even further agricultural productivity growth.

The farmland sales market was virtually non-existent for over three decades, instead rental transactions dominated. The farmland sales market began operating only in July 2021, and in a very limited format. Only individuals could purchase farmland plots and with a 100-ha cap per person. The minimum price was set at the normative monetary land value, and tenants had pre-emptive purchase rights while foreigners and legal entities were excluded; state and communal farmland remained under the 2001 sales ban. The farmland sales market opening was part of a large-scale land reform to support an efficient and transparent farmland market. This included a legislation package aimed at preventing land raiding, decentralizing land management, introducing electronic land auctions, establishing tools for land planning and use, creating a national infrastructure for geospatial data, establishing institutions for supporting small scale farmers, and empowering small scale farmers capacity to compete for land (KSE, 2021).

In general, there are two broad benefits of sales and lease transactions. First, the farmland market, via transactions, sorts out more efficient farms from less efficient ones, thus increasing the overall sector value added. Another important benefit, specifically linked to the farmland sales market, is that a functioning farmland sales market makes farmland a collateral which can generate productive investments in increased agricultural and non-agricultural productivity growth (Deininger and Nivievskyi, 2019).

Early Reform Outcomes

Almost two out of the first two and a half years of the reform phase unfolded amidst the profound shock from Russia’s full-scale invasion of Ukraine. Following this, nearly 20 percent of Ukraine’s farmland has been occupied (Mkrtchian and Mueller, 2024), almost a third of the agricultural sector has been ruined – the total damages and losses to the agricultural sector amount to US$ 80 billion (Neyter at al., 2024). As a result, a very restrictive first-phase format of the market, on top of the war challenges, effectively limited the expected benefits of the market liberalization.

The war has put a sizable drag on the farm-land sales market development, effectively slashing the transacted volume almost by half (see Figure 1).

Figure 1. Cumulative market transactions and the effect of the war.

Source: Nivievskyi and Neyter, 2024.

Overall, about 1.1 percent of total farmland area, or about 1.3 percent of Ukraine’s total controlled farmland (equivalent of 200,000 sales transactions or 444,300 ha) has been traded since the opening of the market. Regionally, the outcome is quite diverse (see Figure 2).

This is nonetheless an encouraging outcome as it is quite comparable to developed countries benchmarks where, on average, roughly 1 percent (and up to 5 percent) of the total agricultural land area is transacted annually (Nivievskyi et al., 2016). Another important outcome is that the transacted farmland has remained in agricultural production.

Farmland price development is also positive, especially for commercial farmland (see Figure 3). Since the commencement of the farmland sales market in Ukraine, the capitalization has increased by US$ 5.5 billion (KSE Agrocenter, 2024).

In fact, farmland market capitalization might be even greater. There are indications that the actual market price should be much higher, on average, than the officially registered one, as transacting parties may try and evade fees and taxes (Nivievskyi and Neyter, 2024).

Figure 2. Transacted area as share of total oblast (administrative region) area.

Source: The Center for Food and Land Use Research at Kyiv School of Economics (KSE Agrocenter), 2024.

Continued Farmland Market Liberalization and Associated Expectations

As of January 1, 2024, legal entities gained the right to acquire farmland that had, from 2001, been under sales ban. Also, in this second stage, the farmland accumulation cap per beneficiary increased to 10,000 hectares. Other restrictions remain, including that legal entities with a foreign beneficiary still cannot purchase farmland.

The first results of the second stage are premature, and firm conclusions cannot be drawn, yet the preliminary results are quite encouraging. The new market participants have already increased the volume of transactions and corresponding price by 13 percent, on average (see Figure 3).

Figure 3. Average farmland prices, in thousands UAH.

Source: KSE Agrocenter (2024). Note: Demonstration and estimations are based on the State GeoCadaster Data.

Another encouraging result highlights that legal entities bring further transparency into the market. For half of the transactions involving individuals, the sales price did not exceed the minimum price by more than 1.5 percent, while in half of the farmland transactions with legal entities, the price exceeded the minimum one by more than 44 percent.

These early results provide insight into the market’s direction and the associated benefits. The expected economic benefits from liberalizing the farmland market for legal entities could amount to an annual increase of 1-2.7 percent of GDP over the next three years.  The scale depends on many factors, including the availability of financing and financial support for small farmers (KSE Agrocenter, 2023).

Rural and agricultural financing is of particular interest as land is generally considered a high-quality collateral which could be utilized to attract loans and investments. This is particularly important during the current wartime period, as agricultural producers are facing significant collateral damage and severe financial difficulties for the third consecutive year. Currently, despite its potential, only a meager share of all farming loans is secured by farmland – far below global benchmarks.

Under current registered farmland prices, the total farmland market capitalization is equivalent to roughly US$ 35.5 billion. This could potentially generate an additional US$ 12.4 billion of loans (under the current low liquidity risk ratio of 0.35), already much greater than the current agricultural debt of about US$ 3.5 billion. Adding legal entities to the pool of farmland buyers (as of January 2024), is expected to increase farmland prices by an additional 40 percent. Thus, the farmland market will grow to almost US$ 50 billion, and the volume of land-secured financing could amount to US$ 17.5 billion. Further liberalization of the farmland market, such as a strengthening of its transparency, boosting the market liquidity, and accumulating necessary market statistics, may allow the National Bank of Ukraine to reconsider the liquidity risk ratio for farmland – potentially considering it as collateral similar to other types of real-estate (see the National Bank of Ukraine Resolution #351, June 30, 2016). A liquidity risk ratio at the level of developed countries (0.6-0.8) could further increase the volume of potential land-secured financing available to agriculture and rural areas/landowners to at least US$ 35 billion. This would, in turn, close the more than US$ 20 billion current financing gap for agricultural reconstruction, recovery and development. It would also contribute to Ukraine’s nearly US$ 500 billion reconstruction and recovery needs.

Further significant strides toward liberalizing Ukraine’s farmland sales market are anticipated as part of the country’s journey towards EU membership (European Commission, 2024), aligning with Chapter 4 ‘Free Movement of Capital’. Specifically, this pertains to allowing foreigners (EU citizens and legal entities) the right to purchase Ukrainian farmland (Nivievskyi and Neyter, 2024).

Conclusion

Russia’s full-scale invasion of Ukraine have inflicted massive damages and losses to Ukraine, already amounting to more than 2.5 times Ukraine’s 2023 GDP. The recently estimated reconstruction and recovery needs measure at nearly US$ 500 billion. This is an unbearable burden for Ukraine alone. Despite substantial and continuing support from international partners and donors, Ukraine will need to heavily draw on its own resources and capacity to generate private financing, not just for the country’s reconstruction, but also for its long-term development. It is therefore essential, from the Ukrainians government’s perspective, to focus on necessary reforms and optimize policy decisions to leverage the scarce public and donor resources and facilitate and crowd in private investments. Continued farmland market liberalization is one such critical reform, providing hope to generate substantial private investment in the agricultural sector and rural areas.

The size of the farmland market is immense (with farmland accounting for more than 70 percent of Ukraine’s territory). The first two years following the opening of the farmland sales market demonstrate a substantial potential for private financing generation for agriculture and rural areas. The results from regular market monitoring and the early findings, as discussed above, suggest that further farmland market liberalization and increased transparency could generate about US$ 35 billion of financing for agricultural producers and rural areas/landowners. That could, in turn, close the current agricultural financing gap of more than US$ 20 billion for rebuilding and recovery, as well as partially close the nearly US$ 500 billion financing gap for Ukraine’s overall reconstruction and recovery. The expected economic benefits from liberalizing the farmland market for legal entities are estimated at 1-2.7 percent of GDP annually, over the next three years. A further liberalization of the farmland market, and a step towards EU membership, would include granting foreigners (EU citizens and legal entities) the right to buy Ukrainian farmland – expected to bring even further benefits.

References

Disclaimer: Opinions expressed in policy briefs and other publications are those of the authors; they do not necessarily reflect those of the FREE Network and its research institutes.

Trending? Social Media Attention on Russia’s War in Ukraine

Posted on February 19, 2024 | Policy Brief

20240218 Social Media Attention on Russia Image 01

Russia’s invasion of Ukraine is one of the most important geopolitical events of the 21st century. For almost two years, international news outlets have been covering the war, often providing daily or even hourly updates. But what is the level of public interest and public engagement in countries around the world? When does the war capture an international audience’s attention and what are the events that supplant it? This brief uses data on X (formerly Twitter) trends in 62 countries to address these questions.

The competition for attention is a defining feature of our information landscape. From the relentless stream of social media updates to the myriad of news articles vying for our clicks, individuals are constantly bombarded with information, each competing for a slice of their limited attention. Amidst this cacophony of voices, certain topics rise to the forefront, capturing the collective consciousness and dominating public discourse.

Russia’s war in Ukraine has, for obvious reasons, commanded significant media coverage over the past two years. It has been described as a hybrid war, where conventional military tactics are increasingly combined with non-traditional methods. This includes an information war, fought with narratives to manipulate people’s perceptions, spread falsehoods, or enlist support. To a large extent, this information war has taken place on social media. On the one hand, social media platforms have been used to spread disinformation and propaganda. For example, we’ve seen the spread of false narratives about the causes of the war, the actions of the different parties involved, and the suffering of the Ukrainian people. But on the other hand, social media has also been used to counter this disinformation, with fact-checking initiatives and grassroots efforts to promote accurate information.

This policy brief analyses the prominence of the war in social media discourse. While the content on traditional media outlets provides a snapshot of the supply of information, platforms like X/Twitter offer a unique window into the broader population’s demand for that information and how they evolve over time. Whether or not hashtags related to Russia’s war in Ukraine are trending in a given country, depends not just on the public’s interest in the war relative to other events in the news, but also on the level of interest relative to sport, music, television, and cats. By tracking the prevalence of trending hashtags, we can gain insights into the public’s engagement with Russia’s war in Ukraine, going beyond traditional media narratives and high-level governmental discussions to uncover the conversations and sentiments that shape broader public opinion.

The X/Twitter data suggest that in most countries, social media attention in the Russian war on Ukraine has been short-lived and sporadic. On February 24, 2022, Ukraine-related hashtags were trending in 100 percent of the countries in our dataset. Two weeks later, on March 9, 2022, they were trending in only 3 percent of the countries. We find that geographical proximity to the conflict is a strong predictor of social media interest. Related hashtags trend most frequently in Eastern, Central and Northern Europe. We also document spikes in interest around events that link a country to the war in Ukraine: announcements of military assistance or visits by Ukraine’s President Volodymyr Zelenskyj. Finally, we compare the hashtags trending in NATO countries to those trending in countries that either sided with Russia or abstained from voting in a critical UN resolution and show significant differences between the two groups.

Data and Methodology

The source for our dataset is archive.twitter-trending.com – a website that records trending hashtags on X/Twitter across countries and over time. We scrape this website to collect (i) the five highest volume topics in each country on each day and (ii) the five longest-trending topics in each country on each day (these two categories can overlap). Our sample consists of the 62 countries available on the website and covers the timeframe July 2021 to December 2023. From this, we construct a country-by-day panel dataset with 55,862 observations.

We identify 11 topic categories that collectively account for the overwhelming majority of trending topics related to Russia’s war in Ukraine. These topics and their relative frequency are shown in Figure 1. The three dominant categories are “Ukraine”, “Russia” and ”Putin”. We use Google’s translation software to translate non-English tweets which account for a significant fraction of the dataset.

Figure 1. Frequency of hashtags in 11 category topics.

Note: This chart shows the number of times topics assigned to our 11 war-related categories were among the top five longest trending topics (in orange) or the top five highest volume topics (in blue) in any country on any day in our dataset. The source are data scraped from archive.twitter-trending.com

Figure 1 shows that it is more common for war-related topics to be among the highest volume topics on a given day than among the longest trending topics. This suggests that these topics attract a lot of interest in a narrow timeframe (e.g. when news breaks) but are relatively less likely to remain prominent over a whole day. Despite this difference, we find that the distinction between highest-volume and longest-trending does not affect any of the patterns we observe when comparing across countries or time. For simplicity, the results shown below all use the highest-volume measure.

It is important to acknowledge the limitations of the X/Twitter data. Firstly, the population actively using X/Twitter is not representative of the overall population. Secondly, the composition of users may differ across countries which complicates cross-country comparisons. Trending hashtags provide an indicator of public interest that is informative only because we do not have high frequency, nationally representative surveys that are comparable across countries. Finally, we are only able to observe the top-five hashtags in a country on any given day. In principle, a war-related topic could increase in absolute volume from one day to the next, while still being crowded out of the top five.

Geographic Variation in Attention

Social media attention to the war in Ukraine varies greatly across countries. The map in Figure 2 shows the proportion of days when any hashtag from the considered categories was among the top-five most tweeted, for each country in the database since the start of the war. Interest has, on average, been higher in Europe as well as in Anglo-Saxon countries. In contrast, other regions of the world exhibited less sustained interest, as indicated by the lower frequency of related hashtags among the top-five most tweeted topics.

Figure 2. Prevalence of war-related hashtags.

Note: The map shows the share of days on which war-related hashtags (in our 11 categories) were among the top five highest volume topics on X/Twitter between 24/02/2022 and 18/12/2023. Countries in white are not among the 62 countries in the dataset. The source are data scraped from archive.twitter-trending.com

To some extent, this heterogeneity is explained by distance. Figure 3 plots the frequency of war-related trends against geographical proximity to the conflict zone (represented by the distance from each country’s capital to the city of Kharkiv in eastern Ukraine, a major point of focus during the ongoing war). The relationship is clearly negative, suggesting that physical distance from the crisis reduces the intensity of online discourse and public interest. Unsurprisingly, the number of related trends is highest in countries directly or indirectly involved in the conflict – Ukraine, Russia, and Belarus – as well as in Latvia which borders both Russia and Belarus.

Figure 3. Frequency of war-related hashtags and distance from Kharkiv.

Note: The chart shows the log of the distance from each country’s capital city to the city of Kharkiv in km on the x-axis and the logged frequency of war-related topics among the top five highest volume topics in that country between 24/02/2022 and 18/12/2023 on the y-axis. The source are data scraped from archive.twitter-trending.com

Variation in Attention Over Time

Over the past two years, the war has sustained a relatively high intensity. By contrast, global attention on X/Twitter has been more sporadic, spiking around specific events. This is shown in Figure 4, which plots the day-to-day variation in the number of battle events as recorded by the Armed Conflict Location & Event Data Project (ACLED) (in blue) as well as the share of countries where war-related tweets are trending (in orange). Attention was highest at the time of the invasion in February 2022 and the days of the Wagner Group rebellion in June 2023. Overall, the correlation between twitter trends and conflict intensity is positive but relatively weak.

Figure 4. Frequency of war-related hashtags and intensity of conflict.

Note: The chart shows the number of daily battle events in Ukraine as classified by ACLED on the left axis (in blue) and the share of countries where war-related topics were trending on the respective day on the right axis (in orange). The sources are ACLED’s Ukraine conflict monitor and data scraped from archive.twitter-trending.com

Attention also reacts to other major global events. Figure 5 compares the number of top-five trending hashtags related to the categories of interest in each country on two specific dates: February 24, 2022, the day of Russia’s full-scale invasion of Ukraine, and October 7, 2023, the day of a Hamas terror attack on Israel. On the day of the Russian invasion, the majority of countries in our sample exhibited the highest value. In contrast, on the day of the Hamas attack, related hashtags were trending almost nowhere outside Ukraine and Russia, indicating that global attention and engagement with this new ongoing crisis significantly overshadowed the focus on the situation in Ukraine. This shift in attention demonstrates how breaking news can capture the public’s interest and divert focus from ongoing crises, affecting the level of engagement on social media and potentially influencing the global response and discourse surrounding these events.

Figure 5. Map of prevalence of war-related hashtags on two different dates.

Note: The maps show the share of the top five highest volume topics on twitter related to Russia’s war on Ukraine. The map on the left shows 24/02/2022 – the day of Russia’s invasion. The map on the right shows 07/10/2023 – the day of a Hamas terror attack on Israel. Countries in white are not among the 62 countries in the dataset. The source are data scraped from archive.twitter-trending.com

While some events impact attention globally, others affect the salience of the conflict for a specific country. Figure 6 shows that people pay more attention to the war when there is a tangible connection to their own country. The panel on the left shows that war-related topics were more likely to trend in a country around the days where the country announced an aid package for Ukraine (military, financial or humanitarian). It shows an increasing trend in the preceding days and a peak on the day of the announcement. The panel on the right shows that war-related topics were more likely to trend in a country around the days of a visit from President Zelenskyj. This effect is large in magnitude but only lasts for around three days.

Figure 6. Likelihood of hashtags trending in relation to country-specific event.

Note: The charts show variation in the share of countries where at least one war-related topic was among the top five highest volume topics on days relative to a specific event. In the left chart, day 0 represents the day on which a country’s government announces an aid package for Ukraine. In the right chart, day 0 represents the day on which President Zelenskyj arrived in a country for an official visit. The source for these charts are: (i) the Kiel Institute’s Ukraine Support Tracker (Trebesch et al., 2023), (ii) Wikipedia’s list of official visits by President Zelenskyj and (iii) data scraped from archive.twitter-trending.com

While the events above act as drivers of attention, it is also interesting to consider what causes war-related topics to drop out of the top five trending topics. We distinguish between two reasons why war-related hashtags could stop trending: (i) a loss of interest that results in a reduction in the absolute number of related tweets (ii) the rise of other topics that displace war-related tweets from the top five. Figure 7 focuses on days where war-related topics dropped out and compares the volume of tweets on the last day where they were in the top five, to the threshold they would have had to surpass in order to make the top five on the subsequent day. In cases where the threshold is lower than the previously observed volume of tweets (a ratio of less than 1), the topic would have kept trending had it sustained its volumes, and one can conclude there was an absolute loss of interest. In cases where the ratio is greater than one, it is possible that the topic sustained its previous volume of tweets but was crowded-out by the rise of a new trending topic. Figure 7plots the histogram of this ratio. 73 percent of the cases are in the first category (loss of attention) and 27 percent are in the possible crowding out category. This provides further evidence to suggest that attention to the war on social media is typically fleeting.

Figure 7. Loss of attention vs crowding out.

Note: The sample are country-days where war-related topics were among the top five highest-volume topics but then dropped out of the top five the next day. The chart provides a histogram of the ratio of the threshold for making the top five on the subsequent day to the highest volume of tweets of a war-related topic. Values below 1 (in blue) indicate that the volume was above the next day’s threshold and the topic declined in absolute terms. Values above 1 (in orange) indicate that the volume was below the next day’s threshold. The source are data scraped from archive.twitter-trending.com

We also examine the content of discussions on the first day after war-related hashtags drop out of the top five. The word cloud in Figure 8 suggests that on such days, people primarily discuss entertainment topics like music and football.

Figure 8. Word cloud of hashtags trending on days war-related categories drop out.

Note: The figure provides a word cloud of trending topics on country-days where no war-related topic was among the top five highest volume topics, but at least one war-related topic had been in the top five on the previous day. The source are data scraped from archive.twitter-trending.com

Content and Context of War-Related Discourse

In addition to providing insight into the level of engagement, hashtag analysis can also reveal the content and context of popular discourse surrounding the war. By examining words trending on the same days as those from our 11 categories, we can gain a better understanding of the topics people are discussing and how the conversation varies across different regions. Figure 9 illustrates this through word clouds, showing the language used in NATO countries on the left and in countries that abstained or voted against the United Nations General Assembly Resolution ES-11/1 on the right. This resolution, dated March 2, 2022, condemned the brutal invasion of Ukraine and demanded that Russia immediately withdraw its forces and comply with international law.

This exercise allows us to compare the dominant themes and narratives in these two groups of countries and observe any differences in public perception and discourse regarding the conflict. The prevalence of cryptocurrency and NFT (non-fungible tokens) references in the word cloud on the right is suggestive of how economic interests and alternative financial systems could be relevant for the positions of countries that abstained or voted against the resolution, and how this might affect their involvement or response to the conflict. On the left, words like “NATO”, ”Biden”,  and ”Trump” clearly stand out, suggesting that these topics are central to the discourse on the war in NATO countries. This could indicate a focus on geopolitical alliances, international cooperation, and the role of key political figures in shaping the response to the conflict. Interestingly, “Putin” is very prominent in the left word cloud while “Russia” and “Russian” are more prominent on the right. This could indicate that Putin is seen and discussed as the primary antagonist in NATO countries.

Figure 9. Word cloud of hashtags in NATO countries vs Russia-friendly countries.

Note: These word clouds represent topics that trend on days where at least one war-related topic is trending in the respective country. The cloud on the left shows NATO countries. The cloud on the right shows countries that either abstained or voted against United Nations General Assembly Resolution ES-11/1. The source are data scraped from archive.twitter-trending.com

Conclusion

This brief uses X/Twitter trends as a barometer of public interest in Russia’s war in Ukraine. We show how attention fluctuates over time in response to developments in the conflict, to other breaking news, and to local events that make the conflict salient for a domestic audience. We also provide descriptive evidence on the variation across geographical regions and among different groups of countries. Additionally, we analyse the instance where Ukraine-related topics stop trending and find suggestive evidence that this is typically due to a gradual loss of interest rather than crowding out by new distracting trends.

Public attention and engagement drive policy in democratic countries, and the sustained support of its democratic allies is vital for Ukraine during this critical time. Understanding the patterns and influences of public attention is crucial for developing effective strategies to sustain engagement and support. This can be achieved for example by regularly highlighting the ongoing significance and bearing of Russia’s war against Ukraine, even as other events dominate the headlines. Emphasizing the impact of the conflict on individuals and communities, as well as its broader implications for international relations and global security, can help sustain public interest and engagement.

References

  • ACLED. Ukraine Conflict Monitor. https://acleddata.com/ukraine-conflict-monitor/
  • Trebesch, C., Antezza, A., Bushnell, K., Bomprezzi, P., Dyussimbinov, Y., Frank, A., Frank, P., Franz, L., Kharitonov, I., Kumar, B., Rebinskaya, E., Schade, C., Schramm, S., and Weiser, L. (2023). The Ukraine Support Tracker: Which countries help Ukraine and how? Kiel Working Paper, 2218, 1-75.
  • Twitter Trending Archive. Scraped on ##/12/2023. https://archive.twitter-trending.com/

Disclaimer: Opinions expressed in policy briefs and other publications are those of the authors; they do not necessarily reflect those of the FREE Network and its research institutes.

Ukrainian Refugees: Who Returns and Why?

Posted on January, 2024 | Policy Brief

Image depicting Ukrainian refugees, including a child holding a teddy bear, eagerly awaiting their return to Ukraine

Of the 17 million Ukrainians who have fled the country since the full-scale Russian invasion in spring 2022, over 60 percent have returned to the country. Based on survey data of Ukrainians who were previously abroad but have returned and those who have remained abroad, we look at the factors that impact their respective decisions to return or to stay. We find that having family in Ukraine is an important factor, but so is missing one’s home, a wish for children to study in Ukraine and a desire to participate in the reconstruction of Ukraine. People who emigrated with their spouse, and those who had planned to emigrate prior to the full-scale war, are more likely to stay abroad. We also find that those staying in a host country are highly involved in Ukrainian affairs and argue that the Ukrainian government should consider them a resource rather than lost human capital.

One of the major consequences of the Russian war on Ukraine has been the mass exodus of Ukrainians fleeing the war. As of February 2022, the Ukrainian statistical agency has ceased publishing population data for both technical and security reasons, so the exact number of Ukrainians that have left the country is unknown. However, on the basis of  mirror statistics from other countries, data from international organizations or surveys, it can be estimated that about 17 million people have fled the country since February 2022. Out of those, over 60 percent have returned to Ukraine, while 6 million Ukrainians have remained abroad.

As people are key in the future reconstruction and development of Ukraine, it is of great importance to understand what factors drive people to return (or not to return) to Ukraine. A recent paper (Sologoub, 2024) aims at addressing this question using a representative survey implemented by the Factum Group in July-August 2023. The survey includes 1400 people who, since early 2022, have fled Ukraine.  Half of the respondents had returned to Ukraine at the time of the survey while the other half remained abroad. The first group is from here on referred to as returnees and the latter as refugees.

To look at the factors that determine individual’s decisions to return or stay abroad, the paper specifically considers the factors that impact three probabilities:

  • the probability that a person stays abroad;
  • the probability that a person who stays abroad plans to return (64 percent of the refugees);
  • and the probability that a person who returned plans to stay in Ukraine (56 percent of the returnees).

This policy brief briefly describes the survey data, summarizes the key findings and concludes with policy implications and recommendations.

Main Characteristics of the Survey Respondents

The survey data shows that out of the entire sample of people who have returned to Ukraine and who have remained abroad, over 80 percent are women, and out of these 44 percent emigrated from Ukraine with children. About a quarter of our respondents stay or have stayed in Poland or Germany, 7 percent in the Czech Republic, while other countries have accommodated up to 4 percent of the Ukrainian migrants in our sample. The main reason for emigration is safety – almost half of the respondents reported it being the main reason for leaving Ukraine (see Figure 1).

Figure 1. Stated reasons for migration choices.

Source: Factum Group survey, own calculations. Note: Blue bars are for returnees, orange bars are for refugees (i.e. individuals who have stayed in host country). A dark color denotes the main reason, and a light color denotes other reasons.

Half of the respondents who had a job in Ukraine prior to the war lost their jobs at onset of the full-scale invasion, 18 percent quit their jobs and 30 percent continued to work remotely. 53 percent of the refugees had a job at the time of the survey, and 9 percent of those who remained abroad worked online for a Ukrainian organization. Of those who worked abroad at the time of the survey, 61 percent remained on the same qualification level, while 37 percent changed their qualification level – the majority of those changed to a lower qualification level.

39 percent of all respondents had school-aged children. A quarter of them reported that their children studied only online in Ukrainian schools in 2022/23. Over 60 percent stated that their children studied in a host country, but most of these children took additional classes within the Ukrainian school program – in an online or offline environment, with tutors or on their own.

When asked to compare different aspects of their life abroad and in Ukraine, approximately equal shares of the respondents reported an improvement or a worsening of these aspects. Worsening aspects was mainly reported to concern relations with friends, psychological state, and healthcare. The respondents also stated reasons for their return to Ukraine (or willingness to return), which allowed for estimation of the significance of these reasons. Generally, we found that pull factors (factors attracting people to return to Ukraine) are much more powerful than push factors (factors that force people out of host countries).

Main Results from the Probability Models

Demographic factors (age, education, family status, or income group) are non-significant across all models with the exception of marital status. People who are single are more likely to return to Ukraine, while those who migrated together with their spouse and those who do not have children are more likely to stay abroad.

Significantly positive for the probability that a person had returned at the time of the survey were pull factors such as missing family or home, the wish for children to study in Ukraine, better job opportunities in Ukraine, having property in Ukraine, and returning friends. Some significant push factors were loneliness or integration hardship, as well as feeling humiliated for living on subsidies/state support.

Among respondents who lived abroad at the time of the survey, 64 percent planned to return to Ukraine someday, 13 percent did not plan to return to Ukraine and the rest were undecided. One should however keep in mind that peoples’ intentions can change rather quickly – in the qualitative part of the survey, some respondents explained that their decision to return was spontaneous.

The probability that a person plans to return was lower for people who had planned to emigrate prior to 2022, for people who hadn’t been to Ukraine since they fled, and for people with refugee status (in some countries, people may lose refugee protection status if they exit the host country and travel to Ukraine).

Safety improvements and better job prospects increase the probability that a refugee plans to return, as well as a wish for children to study in Ukraine and a desire to participate in Ukraine’s reconstruction. Over 70 percent of the respondents believe that their experiences from abroad will be useful for the reconstruction and over 50 percent state that the new skills they’ve gained abroad can be applied during the reconstruction of Ukraine.

Significant push factors are lacking integration into the local community and an inferior social life abroad compared to life in Ukraine. Higher levels of general well-being and life satisfaction abroad expectedly reduce the probability that a person plans to return.

Lastly, those who had returned to Ukraine at the time of the survey were asked whether or not they planned to stay in Ukraine. 56 percent said yes, 7 percent plan to emigrate again, while the rest will consider the circumstances. The main factors that keep a person in Ukraine are family, the wish for one’s children to study in Ukraine and a willingness to participate in the reconstruction of the country. Improved safety is also a significant factor – which might explain why people who are originally from the Western part of Ukraine are more likely to stay (the regional factor is significant only in this third probability model). Finally, people who planned to emigrate prior to 2022, or those whose life in Ukraine is considerably inferior to that abroad, are less likely to stay.

Ukrainians’ Liaison with Their Country

60 percent of the refugees read Ukrainian news daily, and over 90 percent read them at least several times a week. The majority of the readers spread these news in their local communities and/or in their social networks. Generally, Ukrainian refugees are quite active, over 40 percent attend rallies in support of Ukraine, almost 40 percent participate in volunteer projects, over 70 percent donate to Ukrainian organizations (and the same share help their relatives in Ukraine) and 15 percent work at a non-governmental organization.

Not surprisingly, the opinion among Ukrainian refugees on reforms in Ukraine is very similar to the opinion among returnees: anti-corruption and judicial reform have the highest priority. In line with this, the fear of corruption derailing the reconstruction of Ukraine is greater than the fear that Russia will continue with their missile attacks on Ukraine. Therefore, the determination of the Ukrainian government to fight corruption will likely not only improve life for people in Ukraine but also increase the probability that refugees return to Ukraine.

Conclusion

Most of the Ukrainians who initially fled the war have already returned to Ukraine, with the majority planning on staying in the country. For those who are still abroad, the majority wish to return when safety improves. When analysing the factors behind such wishes, it is evident that among the pull factors lie not only personal drivers, such as missing one’s home or family, but also civic factors such as a willingness to participate in the reconstruction of Ukraine or a wish for one’s children to study in Ukraine, thus contributing to preserving their identity. Moreover, Ukrainians who are living abroad are highly involved in Ukrainian affairs.

Therefore, we suggest that the Ukrainian government consider refugees as a valuable resource rather than as a loss. For example, government representatives could ask refugees to donate to Ukraine, and engage in individual or collective actions (e.g. inform their local friends about the situation in Ukraine, join rallies or flashmobs in support of Ukraine etc.). Such “people’s diplomacy” is important to ensure continued support for Ukraine.

We also recommend that the governments of host countries make it easier for refugees to stay connected with Ukraine. Specifically, refugees should be allowed to travel to Ukraine without losing their protection status.

Lastly, the strongest precondition for refugees’ return to Ukraine is supplying the country with weapons and other crucial support to win the war. A Ukrainian victory will not only bring about reconstruction and development of Ukraine but also promote and enforce global democracy.

References

Disclaimer: Opinions expressed in policy briefs and other publications are those of the authors; they do not necessarily reflect those of the FREE Network and its research institutes.

How to Undermine Russia’s War Capacity: Insights from Development Day 2023

Posted on January 15, 2024 | Policy Brief

Image from SITE Development Day conference

As Russia’s full-scale invasion of Ukraine continues, the future of the country is challenged by wavering Western financial and military support and weak implementation of the sanction’s regime. At the same time, Russia fights an information war, affecting sentiments for Western powers and values across the world. With these challenges in mind, the Stockholm Institute for Transition Economics (SITE) invited researchers and stakeholders to the 2023 Development Day Conference to discuss how to undermine Russia’s capacity to wage war. This policy brief shortly summarizes the featured presentations and discussions.

Holes in the Net of Sanctions

In one of the conference’s initial presentations Aage Borchgrevink (see list at the end of the brief for all presenters’ titles and affiliations) painted a rather dark picture of the current sanctions’ situation. According to Borchgrevink, Europe continuously exports war-critical goods to Russia either via neighboring countries (through re-rerouting), or by tampering with goods’ declaration forms. This claim was supported by Benjamin Hilgenstock who not only showed that technology from multinational companies is found in Russian military equipment but also illustrated (Figure 1) the challenges to export control that come from lengthy production and logistics chains and the various jurisdictions this entails.

Figure 1. Trade flows of war-critical goods, Q1-Q3, 2023.

Source: Benjamin Hilgenstock, Kyiv School of Economics Institute.

Offering a central Asian perspective, Eric Livny highlighted how several of the region’s economies have been booming since the enforcement of sanctions against Russia. According to Livny, European exports to Central Asian countries have in many cases skyrocketed (German exports to the Kyrgyzs Republic have for instance increased by 1000 percent since the invasion), just like exports from Central Asian countries to Russia. Further, most of the export increase from central Asian countries to Russia consists of manufactured goods (such as telephones and computers), machinery and transport equipment – some of which are critical for Russia’s war efforts. Russia has evidently made a major pivot towards Asia, Livny concluded.

This narrative was seconded by Michael Koch, Director at the Swedish National Board of Trade, who pointed to data indicating that several European countries have increased their trade with Russia’s neighboring countries in the wake of the decreased direct exports to Russia. It should be noted, though, that data presented by Borchgrevink showed that the increase in trade from neighboring countries to Russia was substantially smaller than the drop in direct trade with Russia from Europe. This suggests that sanctions still have a substantial impact, albeit smaller than its potential.

According to Koch, a key question is how to make companies more responsible for their business? This was a key theme in the discussion that followed. Offering a Swedish government perspective, Håkan Jevrell emphasized the upcoming adoption of a twelfth sanctions package in the EU, and the importance of previous adopted sanctions’ packages. Jevrell also continued by highlighting the urgency of deferring sanctions circumvention – including analyzing the effect of current sanctions. In the subsequent panel Jevrell, alongside Adrian Sadikovic, Anders Leissner, and Nataliia Shapoval keyed in on sanctions circumvention. The panel discussion brought up the challenges associated with typically complicated sanctions legislation and company ownership structures, urging for more streamlined regulation. Another aspect discussed related to the importance of enforcement of sanctions regulation and the fact that we are yet to see any rulings in relation to sanctions jurisdiction. The panelists agreed that the latter is crucial to deter sanctions violations and to legitimize sanctions and reduce Russian government revenues. Although sanctions have not yet worked as well as hoped for, they still have a bite, (for instance, oil sanctions have decreased Russian oil revenues by 30 percent).

Reducing Russia’s Government Revenues

As was emphasized throughout the conference, fossil fuel export revenues form the backbone of the Russian economy, ultimately allowing for the continuation of the war. Accounting for 40 percent of the federal budget, Russian fossil fuels are currently mainly exported to China and India. However, as presented by Petras Katinas, the EU has since the invasion on the 24th of February, paid 182 billion EUR to Russia for oil and gas imports despite the sanctions. In his presentation, Katinas also highlighted the fact that Liquified Natural Gas (LNG) imports for EU have in fact increased since the invasion – due to sanctions not being in place. The EU/G7 imposed price cap on Russian oil at $60 per barrel was initially effective in reducing Russian export revenues, but its effectiveness has over time being eroded through the emergence of a Russia controlled shadow fleet of tankers and sales documentation fraud. In order to further reduce the Russian government’s income from fossil fuels, Katinas concluded that the whitewashing of Russian oil (i.e., third countries import crude oil, refine it and sell it to sanctioning countries) must be halted, and the price cap on Russian oil needs to be lowered from the current $60 to $30 per barrel.

In his research presentation, Daniel Spiro also focused on oil sanctions targeted towards Russia – what he referred to as the “Energy-economic warfare”. According to Spiro, the sanctions regime should aim at minimizing Russia’s revenues, while at the same time minimizing sanctioning countries’ own costs, keeping in mind that the enemy (i.e. Russia) will act in the exact same way. The sanctions on Russian oil pushes Russia to sell oil to China and India and the effects from this are two-fold: firstly, selling to China and India rather than to the EU implies longer shipping routes and secondly, China and India both get a stronger bargaining position for the price they pay for the Russian oil. As such, the profit margins for Russia have decreased due to the price cap and the longer routes, while India and China are winners – buying at low prices. Considering the potential countermoves, Spiro – much like Katinas – emphasized the need to take control of the tanker market, including insurance, sales and repairs. While the oil price cap has proven potential to be an effective sanction, it has to be coupled with an embargo on LNG and preferrable halted access for Russian ships into European ports – potentially shutting down the Danish strait – Spiro concluded.

Chloé Le Coq presented work on Russian nuclear energy, another energy market where Russia is a dominant player. Russia is currently supplying 12 percent of the United States’ uranium, and accounting for as much as 70 percent on the European market. On top of this, several European countries have Russian-built reactors. While the nuclear-related revenues for Russia today are quite small, the associated political and economic influence is much more prominent. The Russian nuclear energy agency, Rosatom, is building reactors in several countries, locking in technology and offering loans (e.g., Bangladesh has a 20-year commitment in which Rosatom lends 70 percent of the production cost). In this way Russia exerts political influence on the rest of the world. Le Coq argued that energy sanctions should not only be about reducing today’s revenues but also about reducing Russian political and economic influence in the long run.

The notion of choke points for Russian vessels, for instance in the Danish strait, was discussed also in the following panel comprising of Yuliia Pavytska, Iikka Korhonen, Aage Borchgrevink, and Lars Schmidt. The panelists largely agreed that while choke points are potentially a good idea, the focus should be on ensuring that existing sanctions are enforced – noting that sanctions don’t work overnight and the need to avoid sanctions fatigue. Further, the panel discussed the fact that although fossil fuels account for a large chunk of federal revenues, a substantial part of the Russian budget come from profit taxes as well as windfall taxes on select companies, and that Russian state-owned companies should in some form be targeted by sanctions in the future. In line with the previous discussion, the panelists also emphasized the importance of getting banks and companies to cooperate when it comes to sanctions and stay out of the Russian market. Aage Borchgrevink highlighted that for companies to adhere to sanctions legislation they could potentially be criminally charged if they are found violating the sanctions, as it can accrue to human rights violations. For instance, if companies’ parts are used for war crimes, these companies may also be part of such war crimes. As such, sanctions can be regarded as a human rights instrument and companies committing sanctions violations can be prosecuted under criminal law.

Frozen Assets and Disinformation

The topic of Russian influence was discussed also in the conference’s last panel, composed of Anders Ahnlid, Kata Fredheim, Torbjörn Becker, Martin Kragh, and Andrii Plakhotniuk. The panelists discussed Russia’s strong presence on social media platforms and how Russia is posting propaganda at a speed unmet by legislators and left unchecked by tech companies. The strategic narrative televised by Russia claims that Ukraine is not a democracy, and that corruption is rampant – despite the major anti-corruption reforms undertaken since 2014. If the facts are not set straight, the propaganda risks undermining popular support for Ukraine, playing into the hands of Russia. Further, the panelists also discussed the aspect of frozen assets and how the these can be used for rebuilding Ukraine. Thinking long-term, the aim is to modify international law, allowing for confiscation, as there are currently about 200 billion EUR in Russian state-owned assets and about 20 billion EUR worth of private-owned assets, currently frozen.

The panel discussion resonated also in the presentation by Vladyslav Vlasiuk who gave an account of the Ukrainian government’s perspective of the situation. Vlasiuk, much like other speakers, pointed out sanctions as one of the main avenues to stop Russia’s continued war, while also emphasizing the need for research to ensure the implications from sanctions are analyzed and subsequently presented to the public and policy makers alike. Understanding the effects of the sanctions on both Russia’s and the sanctioning countries’ economies is crucial to ensure sustained support for the sanction’s regime, Vlasiuk emphasized.

Joining on video-link from Kyiv, Tymofiy Mylovanov, rounded off the conference by again emphasizing the need for continued pressure on Russia in forms of sanctions and sanctions compliance. According to Mylovanov, the Russian narrative off Ukraine struggling must be countered as the truth is rather that Ukraine is holding up with well-trained troops and high morale. However, Mylovanov continued, future funding of Ukraine’s efforts against Russia must be ensured – reminding the audience how Russia poses a threat not only to Ukraine, but to Europe and the world.

Concluding Remarks

The Russian attack on Ukraine is military and deadly, but the wider attack on the liberal world order, through cyber-attacks, migration flows, propaganda, and disinformation, must also be combatted. As discussed throughout the conference, sanctions have the potential for success, but it hinges on the beliefs and the compliance of citizens, companies, and governments around the world. To have sanctions deliver on their long-term potential it is key to include not only more countries but also the banking sector, and to instill a principled behavior among companies – having them refrain from trading with Russia. Varying degrees of enforcement undermine sanctions compliant countries and companies, ultimately making sanctions less effective. Thus, prosecuting those who breach or purposedly evade sanctions should be a top priority, as well as imposing control over the global tanker market, to regain the initial bite of the oil price cap. Lastly, it is crucial that the global community does not forget about Ukraine in the presence of other conflicts and competing agendas. And to ensure success for Ukraine we need to restrain the Russian war effort through stronger enforcement of sanctions, and by winning the information war.

List of Participants

Anders Ahnlid, Director General at the National Board of Trade
Aage Borchgrevink, Senior Advisor at The Norwegian Helsinki Committee
Torbjörn Becker, Director at the Stockholm Institute of Transition Economics
Chloé Le Coq, Professor of Economics, University of Paris-Panthéon-Assas, Economics and Law Research Center (CRED)
Benjamin Hilgenstock, Senior Economist at Kyiv School of Economics Institute
Håkan Jevrell, State Secretary to the Minister for International Development Cooperation and Foreign Trade
Michael Koch, Director at Swedish National Board of Trade
Iikka Korhonen, Head of the Bank of Finland Institute for Emerging Economies (BOFIT)
Martin Kragh, Deputy Centre Director at Stockholm Centre for Eastern European Studies (SCEEUS)
Eric Livny, Lead Regional Economist for Central Asia at European Bank for Reconstruction and Development (EBRD)
Anders Leissner, Lawyer and Expert on sanctions at Advokatfirman Vinge
Tymofiy Mylovanov, President of the Kyiv School of Economics
Vladyslav Vlasiuk, Sanctions Advisor to the Office of the President of Ukraine
Nataliia Shapoval, Chairman of the Kyiv School of Economics Institute
Yuliia Pavytska, Manager of the Sanctions Programme at KSE Institute
Andrii Plakhotniuk, Ambassador Extraordinary and Plenipotentiary of Ukraine to the Kingdom of Sweden
Daniel Spiro, Associate Professor, Uppsala University
Adrian Sadikovic, Journalist at Dagens Nyheter
Kata Fredheim, Executive Vice President of Partnership and Strategy and Associate Professor at SSE Riga
Lars Schmidt, Director and Sanctions Coordinator at the Ministry for Foreign Affairs, Sweden

Disclaimer: Opinions expressed in policy briefs and other publications are those of the authors; they do not necessarily reflect those of the FREE Network and its research institutes.

Ukraine and NATO – Evidence from Public Opinion Surveys

Posted on October 30, 2023 | Policy Brief

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A recent survey on Ukrainians’ attitudes towards a Ukrainian NATO membership shows that 89 percent would support joining the military alliance in a referendum – the highest level of support in the country’s history. Moreover, the convergence of membership attitudes between Western and Eastern regions in Ukraine displays a real loss of trust in Eurasian (pro-Russian) relations as a vector of development for Ukraine. This brief offers some perspectives on how public opinion has changed and what have been the crucial turning points. In particular, the brief digs deeper into the evolution of opinion against a NATO membership, as well as regional differences in attitudes. It also shows how every round of Russian aggression eventually has led to public opinion alignment. These changes not only concern a NATO membership but reflect a deeper transformation of societal values and a consolidation of the Ukrainian national identity, strengthening the grounds for a more democratic society.  

The continued Russian aggression on Ukraine has disclosed several deep-running issues that have for long been undercurrents in Ukraine’s history and whose resolution is a key determinant of the country’s future. One such issue is the relationship with NATO, including a potential accession into the alliance.

The most recent survey on Ukrainians’ attitudes towards Ukrainian NATO membership, conducted in May-June 2023, shows that 89 percent of the respondents would support it in a referendum, 8 percent would not, while 3 percent of the respondents found it difficult to say (KIIS, 2023). The survey (which excludes occupied territories where it was unfeasible to conduct the survey) also shows the lowest ever gap in terms of geographic spread. 93 percent were in favour of membership in the Western regions and 79 percent in the Eastern regions, the traditionally pro-Russian areas where most of the Russian ethnic minority resides. In comparison, in 2017, 71 percent were in support of a NATO membership in the Western regions and 32 percent in the Eastern regions, respectively (Kermach, 2017).

NATO Membership Support in Ukraine Over Time

To gain a deeper understanding of how the public’s opinion on a NATO membership has changed over time, it is suitable to start in 2002, when former President Leonid Kuchma first announced Ukraine’s aspiration to join NATO. At that point the Ukrainian society could be almost equally divided into three categories; those in favour of joining NATO, those against it, and those who refused to take a stance/found it difficult to say/would not vote in a referendum (hereafter referred to as “indecisive respondents”), depicted in Figure 1. This was a very natural consequence of the late 1990s/early 2000s coexisting positive attitudes to both geopolitical directions – towards NATO and the EU, but also towards Eurasian integration.

Figure 1. Attitudes to joining NATO among Ukrainians, 2002-2023.

Source: “30 Years of Independence”, 2021; KIIS, 2023; Rating Group, 2023 and author’s compilations.

One framework for understanding this is the concept of social ambivalence, which has been highlighted as very typical for transitional societies such as Ukraine. For example, Reznik (2022) argues that, in the case of Ukraine the main reason for ambivalent geopolitical orientation is the need for “ideological ‘reconciliation’ of two civilizational directions different in essence and meaning within an unbalanced identity” (Reznik, 2022). Similarly, Golovakha and Panina (2003) suggest that in Ukraine, society simultaneously accepts the old social institutions, which have lost their legality during the transition times but have remained legitimate in the view of the public, and the new social institutions, which have gained legal recognition but have not yet been accepted by society. Ukraine is not unique in this context, similar processes have occurred in many transition countries, for instance in Poland, the Czech Republic, Hungary, Slovakia, Estonia, Lithuania, Latvia and others (see, for instance, Roland, 2000; Murrell, 2003; Gruszewska, 2014; and Becker, 2019). This literature documents a mismatch between old and new institutional structures in transforming countries, strongly associated with low levels of trust in society, resistance to new ideas, strong attachment to traditional behaviors and low social activity levels within society. However, such discordance can change drastically due to shocks facing a society, as illustrated by the change in attitudes towards a NATO membership in Ukraine from the early 2000s and onwards.

In the first decade of the 21st century the Ukrainian society gradually became more aligned against joining NATO. This process intensified after 2010, when Viktor Yanukovych was elected as the President of Ukraine. Soon after the election, the Verkhovna Rada (the Ukrainian Parliament) adopted the law “On the Principles of Internal and Foreign Policy”, establishing the principle of “non-alignment” (Verkhovna Rada of Ukraine, 2010). This implied a Ukrainian commitment not to participate in any military political alliances, including NATO. This decision, alongside successful efforts from pro-Russian authorities in the Eastern regions – including anti-NATO propaganda – resulted in as low as 18 percent support for NATO membership in 2013, and 67 percent of the respondents stating to be against a membership (see Figure 1). Such anti-NATO sentiments can be argued to not only have prepared the grounds for, but also to have been explicitly used as an argument for the Russian aggression in 2014.

However, the illegal annexation of Crimea and the Russian aggression in Donbas in 2014 drastically changed the public’s opinion on the military alliance, increasing the share of NATO membership supporters to close to half of the population and thus exceeding the share of opposing or indecisive respondents for the first time in history. At that point 47,8 percent of Ukrainians were in favor of joining the alliance and 32,4 percent were against it (“30 Years of Independence”, 2021), and in 2014 the “non-alignment” principle was officially repealed. It was even officially stated in the Comment On Amendments to the Law of Ukraine “On Principles of Internal and Foreign Policy”) that the policy had been a decisive factor for the Russian aggression in 2014: “In view of this, the further continuation of the so-called non-alignment policy, which has already led to the loss of Ukraine’s territorial integrity, is contrary to national interests, poses a constant threat to Ukraine’s state sovereignty and territorial integrity, holds back the processes of socio-political and economic reform of the country, and limits Ukraine’s prospects to become a developed European democratic country within the European Union.” (Verkhovna Rada of Ukraine, 2014).

Changes in public opinion in Ukraine is however not only limited to NATO membership attitudes. Naturally, there have been changes in election outcomes and voting patterns as well. Recently, Munroe et al. (2023) found a significant shift in voting patterns in Ukraine after 2014, reporting a dramatic decline in pro-Russian votes in Donetsk, Dnipropetrovsk and Odessa regions that had all traditionally been pro-Russian. Still, about one third of the respondents were continuously negative towards NATO until 2021, when the share of those in opposition of a NATO membership dropped to 24 percent. Potential explanations for the pertaining negative attitudes include a remaining influence from pro-Russian authorities in the Eastern and Southern parts of the country, along with a lack of knowledge and awareness about NATO among the population.

Motives, Regional Variations, and Information Gaps

In this context, it is essential to highlight the Ukrainian’s motives for support, or scepticism towards NATO membership. A nation-wide survey from 2017 shows that among the majority of NATO supporters in Ukraine the dominant motive was the expectation of “security guarantees for Ukraine” (86 percent). On the contrary, those who did not support joining the alliance expressed concerns that a NATO membership might “draw Ukraine into NATO’s military actions” (44 percent) or “provoke Russia to direct military aggression” (28 percent). 27 percent were convinced that “Ukraine, in principle, should be a non-aligned state” (27 percent), and finally, 22 percent were worried that “foreigners and foreign capital will start to rule in Ukraine” (DIF, 2017).

Stereotypes of NATO as either protection or conversely, a threat, for Ukraine are subject to significant regional differences. While in Western and Central Ukraine the perception of NATO as protection clearly prevailed (81 and 68 percent, respectively), attitudes in the Southern and Eastern parts were more uncertain. About the same number of respondents (19 percent) considered NATO as both protection and a threat, while 25 percent of the respondents in the South and 30 percent in Eastern Ukraine didn’t see NATO as either.

The basis for these opinions is most likely a lack of effective information and a lack of understanding of the alliance, as well as the complex geopolitical dynamics involving it. Research has attributed negative attitudes towards NATO to surviving Cold War stereotypes and a lack of information concerning NATO’s specifics, functions, decision-making procedures, and the rights and obligations of member states (Kermach, 2017).

In the 2017 survey, almost every other Ukrainian admitted that they were not well informed about NATO. Only 55 percent of the respondents claimed to “know something about NATO”, while 22 percent said they knew virtually nothing about it. However, a majority of Ukrainians (55 percent) “would like to know more” about NATO, while about a third (36 percent) of the respondents did not express such interest (see Table 1). Also in this regard, regional differences are remarkable. In Western and Central Ukraine, interest in NATO was much higher in 2017 than in the Eastern and Southern parts of the country.

Table 1. Interest in knowing more about NATO among Ukrainians in 2017.

Note: Responses to the question: “Would you like to know more about NATO?”
Source: DIF, 2017.

Public Opinion Consolidation

The most drastic change in attitudes towards a NATO membership has however occurred after the full-scale Russian invasion of Ukraine in February 2022, with the public almost converging in their support of a NATO membership. The ongoing share of NATO supporters exceeds 85 percent, and the increase in this group draws, to an almost equal extent, both from the number of those who previously were against the alliance and those who were previously indecisive. For the majority of those who consistently considered the “non-alignment” policy of Ukraine as optimal (26,6 percent according to Kermach (2017)), it has become obvious that this “non-alignment” strategy has failed to provide effective security guarantees.

Moreover, the perception of a NATO membership as a security guarantee is also changing. In the 2022 Kyiv International Institute of Sociology (KIIS) survey, just below 40 percent of the respondents considered a NATO membership as the ultimate and only security guarantee, while approximately the same number were willing to accept other security guarantees. In the 2023 survey, the share of the former response category increased to 58 percent (with a slight difference within regions – 64 percent in the West and 48 percent in Eastern Ukraine), – while the latter dropped to 25 percent. Furthermore, 76 percent were not willing to accept forgoing a NATO membership as a condition for peace (KIIS, 2023).

Conclusion

Public opinion in Ukraine, including attitudes towards a NATO membership, has been drastically affected by the Russian aggression in 2014, and even more so by the ongoing war. As survey results show, each subsequent round of Russian aggression on Ukraine has only increased the share of NATO membership supporters and decreased the number of respondents indecisive on whether Ukraine should join NATO. Additionally, regional differences in attitudes between the Eastern and Western parts of Ukraine have also smoothened. These changes imply a deep transformation in societal views, where the meaning of living in peace for Ukrainians has transformed from the idea of “non-alignment” into perceiving a NATO membership as a security guarantee and a prerequisite for future peace.

While the transformation of public opinion is important per se, it is only one example of the groundbreaking changes the Ukrainian society has especially undertaken since the invasion in 2022. The necessity to fight the Russian invasion brought about unprecedented consolidation and feelings of a national identity. This, in turn, provides an essential foundation for building trust and active political participation, strengthening the grounds for an effective democratic society.

References

Disclaimer: Opinions expressed in policy briefs and other publications are those of the authors; they do not necessarily reflect those of the FREE Network and its research institutes. 

Choosing Latvia: Understanding the Decision-Making Factors of Displaced Ukrainians

Posted on June 6, 2023 | Policy Brief

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This policy brief is based on an empirical examination of the early-stage migration of Ukrainian war asylum seekers to Latvia in 2022, following the Russian invasion. The study highlights the urgent nature of their displacement and identifies the pivotal role of kinship in Latvia in the decision-making. Three categories of refugees emerge based on kinship ties, employment opportunities, and cultural affinity. The study also reveals the substantial influence of the pre-existing Ukrainian diaspora and underlines the significance of network effects in refugees’ location decisions. Contrary to previous studies, refugees didn’t necessarily settle for the first country available. The research underscores the strategy of seeking support from personal networks in acute displacement scenarios, which appears to be the most influential factor for the choice of location in the decision-making process.

Ukrainian Displaced People in Latvia

The Russian invasion of Ukraine in 2022 triggered a geopolitical upheaval in Europe and resulted in a mass exodus that had not been witnessed since World War II. With the war showing no signs of cessation, return for many of these displaced people appears difficult in the near future. Latvia, although not a bordering country, have become a haven for 36 000 Ukrainian refugees.

This brief seeks insight into Ukrainian displaced people’s preference for Latvia, using interviews conducted in March 2022, a month after the war began. With no common border between Ukraine and Latvia these refugees had to transit through other countries, making the question about the choice of Latvia as their ultimate destination particularly relevant.

Unlike during the migration crisis in 2015 and during the recent influx of Syrians and other groups, the Ukrainian refugees found themselves being welcomed with open arms, belying Latvia’s typically guarded stance towards immigrants. This unexpected warmth is influenced by a multifaceted kinship rooted in historical connections from the Soviet era, a pre-existing Ukrainian diaspora in Latvia, labor migration, and shared cultural elements.

These factors can also play a role in Ukrainian refugees’ choice of Latvia as their ultimate destination. The study underlying this policy brief seeks to explore these facets and unravel the reasons behind the Ukrainian refugees’ choice to seek safety in Latvia.

Migration Decisions

Two aspects are crucial in the analysis of migration decisions: the factors that influence refugees’ choice of destination and the process underlying this decision.

Traditional assumptions surrounding asylum-seeker migration, as emphasized by Böcker and Havinga (1997), suggest that when people are forced to flee, their primary focus is safety – not destination. However, more nuanced perspectives have evolved in recent studies (see Robinson and Sergott, 2002; Brekke and Aarset, 2009). They highlight the calculated and adaptable nature of refugee destination choices throughout the asylum-seeking migration journey, demonstrating that circumstances and journey stage significantly influence destination choices.

Research indicates that host country policies and economic conditions can both enhance and limit refugee flows (Czaika and de Haas, 2017; Ortega and Peri, 2013; Brekke and Aarset, 2009; Diop-Christensen and Diop, 2021; Kang, 2021; Suzuki,2020; Collyer, 2005). However, another line of research emphasizes that policy and economic factors are secondary to networks, cultural affinity, language, and perceptions in determining destination choices (Robinson and Sergott, 2002). Factors such as social networks (Koser and Pinkerton, 2002; Tucker 2018), kinship (Havinga and Böcker, 1999; Neumayer, 2005; Mallett and Hagen-Zanker, 2018), financial resources (Mallett and Hagen-Zanker, 2018), geography (Neumayer, 2005; Kang, 2021), destination country image (Benzer and Zetter, 2014), culture (Suzuki, 2020), and colonial links (Havinga and Böcker, 1999) have been established to be significant at various stages of migration. Economic and education opportunities are also found to have a marginal influence on destination decision-making compared to the possibility of resolving statelessness (Tucker, 2018).

These varying determinants of destination may also be contingent on the refugee journey stage. Policies may not dominate in acute cases of forced migration (Diop-Christensen and Diop, 2021). For individuals with time to prepare for migration, a cost-benefit analysis often informs their decisions. In contrast, those in urgent circumstances, such as during the Russian invasion of Ukraine, may have to take immediate refuge and put less emphasis on benefits and policies (Robinson and Sergott, 2002). Destination determinants differ by both origin and destination countries (Havinga and Böcker, 1999, Tucker, 2018, Gilbert and Koser, 2006). Thus, research on underexplored regions and countries is valuable for a comprehensive understanding of migration patterns.

Migration, voluntary or forced, involves intricate decision-making. As Mallett and Hagen-Zanker (2018) aptly state, the dynamic experiences ‘on the road’ shape refugees’ journey and destination choices. Robinson and Sergott (2002) and Brekke and Aarset, 2009 have pioneered models for asylum seekers’ decision-making, suggesting that factors such as networks, language, cultural affinity, and perceptions evolve across different stages of the asylum journey. Others, like Gonsalves (1992) and Shultz et al. (2020), have constructed models delineating stages of refugee passage and displacement, highlighting the changing needs and preferences of refugees.

While existing literature mainly focuses on the later stages of forced migration journeys, limited empirical evidence exists on the migration moves during acute displacement. Additionally, further understanding on migration induced by the war on Ukraine is needed. There is also incomplete coverage of asylum seeker and refugee topics in the Baltic countries, making such research particularly relevant. To address these gaps, this brief aims to provide qualitative findings on the decision-making and experiences of Ukrainian displaced people in Latvia.

Understanding the Decision

The research underlying this brief explored the reasons behind Ukrainian displaced people’s choice of Latvia as their migration destination during the early part of the invasion. The study is based on 34 semi-structured, in-depth interviews with displaced people conducted in March 2022. The dataset is part of a larger study that includes continuous interviews to understand Ukrainian displaced people’s lives, plans and needs in Latvia.

From the interviews, it was apparent that the predominant factor in respondents’ decision-making was the presence of kin or acquaintances in Latvia.

All but one participant had some connection to Latvia, whether through distant relatives, friends, or professional contacts. The one participant without such connections arrived from Russia and not from Ukraine, working on a contract. A minority of our participants considered staying in Ukraine. One example is Lidiia, who initially planned to move near Lviv, but redirected to Riga during the journey.

“She found a family that would host us, 100 km from Lviv… We agreed, but then our friends… called us on the way, we were leaving Kyiv under bombardment. Our train was delayed because of the air alarm. When we just arrived there, a shell exploded above the railway station… And on the way, friends from Riga called us and invited us: ‘Come, everyone will help here’. Therefore, everything changed while we were on the train, we decided everything“ (Lidiia).

Proximity of kin was not the primary concern for the interviewees; the mere fact that they had a relative in Latvia appeared more influential in their narratives. Indeed, the majority of participants had distant rather than close kin, though a few had close family in Latvia (grandparents, parents, common-law husband, and sister). As Olena explained, the presence of even distant relatives influenced her choice: “there are distant relatives, very distant… That’s why we came” (Olena). However, ties in Latvia were not the only determinants as many of the participants also had family connections in other parts of Europe.

The speed of decision-making was also striking – most decisions to migrate were not a matter of long-term planning but a reaction to the sudden crisis, often influenced by incoming offers of assistance. Nataliia remembered: “My mother said, ‘You have to leave because everything is so fatally bad. Take the children and leave.’ And literally overnight I packed up, bought the tickets. But first I went to Poland, to my brother” (Nataliia).

Maryana ended up choosing her destination only after leaving home. “At first, we thought to go to Poland, but it is completely crowded, and then we called to whoever we could. There are no relatives in other countries. No, there are relatives in other cities, but these are Luhansk, Donetsk, we are from Slobozhanska Ukraine, so all our relatives are from the side where very heavy fighting is going on now“ (Maryana). Such testimonies illuminate how, owing to the immediacy of the situation, the eventual destination of some displaced Ukrainians was not predetermined but evolved during their respective journeys.

From the interviews with the participants who knew someone in Latvia, one can identify three groups based on the main factor that determined their decision.

Network, First of All

For respondents who did not have family in Latvia, friends, acquaintances, and professional contacts in Latvia acted as anchors. Like family members, such acquaintances often reached out, offering assistance and lodging as soon as they heard the news of the war. The influx of supportive communication from Latvian acquaintances influenced the decision for many participants.

Olha decided to flee with her friend, who had a distant cousin residing in Latvia. Upon the onset of the conflict, the cousin reached out and urged them to come to Latvia. As Olha recalls: “As soon as she heard that there was a bombing in Kharkiv, she said, ‘Come’. My friend, with whom I came, Lesya, does not have a car, so she immediately told me… let’s run away’” (Olha).

Lidiia received an invitation from a Latvian friend she had met through her church, even as she was already in the process of fleeing Ukraine. Similarly, Andrii, who was vacationing abroad at the time of the war’s outbreak, remembered: “On the 25th our best friend wrote to us that, ‘There is housing, come here’ and we began to negotiate with the embassy to fly here” (Andrii).

Even in the absence of explicit messages, displaced individuals recalled having friends and family in Latvia and chose to make their way to Riga. Olena, like Lidiia, initially set off without a clear destination in mind. It wasn’t until she reached the border that she decided to head to Latvia: “Just at the border that you decided where to go?” (Olena).

Existing friendships and ongoing communication also influenced some people’s choice to opt for Latvia. Olha (2) was encouraged by her daughter to relocate to Riga due to her daughter’s friendships with Latvians that she had formed at a camp in Estonia: “Friends appeared, with whom she was in close contact for six months. That’s why for her there was no choice at all ‘Where?’. She immediately said: ‘To Riga’” (Olha (2)).

Opportunities and Realities

The turning point for many respondents was their arrival in Poland as, initially, Latvia was not the principal or only choice of destination. These respondents emphasized that, besides having friends and relatives in Latvia, they also contemplated where they might find better opportunities. Their narratives provide a contrasting perspective of Poland and Latvia. While traversing Poland, their general impression was that the country was already ‘overfilled’, which in turn kindled the notion that Latvia might harbor more possibilities. For this group of displaced individuals, the importance of employment prospects was paramount.

Nataliia took the decision to head for Latvia, choosing to stay with remote kin there rather than with her sibling in Poland, as she believed Poland lacked opportunities for her. In Myroslava’s case, a friend helped secure a job in Latvia: “We didn’t choose Latvia for any particular reason – better or worse, we didn’t care. We needed somewhere to stay, somewhere to work in order to live. Well, that’s why when a job turned up through acquaintances, they said that a person was needed here, we immediately gathered. Could not be found in Poland. In Poland, there was simply no work, no housing” (Myroslava).

Bohdan, too, mentioned the crowdedness and the high cost of living in Poland, hence deciding to move further north to Latvia: “We didn’t have a specific plan because we weren’t at all sure we would succeed. In general, my wife benefits from going to Poland, she works for an IT company operating in Poland. And we thought about getting there at first, but when we got to Poland, everything was already full. There were such expensive options, $1600 a month, we were shocked” (Bohdan).

Anastasiia echoed similar concerns: “We arrived in Warsaw, reunited there and tried to stay in Warsaw and look for a place, but there are a lot of people there, and there is no place to live, very… food, maybe cheaper than in Latvia, but there is no place to live… no place to work. And I would like to work somehow… not to be dependent” (Anastasiia).

These stories illuminate another stratum of decision-making, that beyond familial ties, participants also considered the opportunities available at their chosen destination. They accumulate information on their journey and recalibrate their destination accordingly.

Cultural Kinship, Language, Diaspora

Not all participants had prior personal experience with Latvia, even if they had relatives there. A lot of their understanding about the country stemmed from stories they’d heard or news they’d come across. This third group of participants decided on Latvia not only because they knew someone in the country, but also because they saw value in shared language, culture, and history.

Political and cultural connections played a significant role in their choice. Being able to communicate in Russian and Ukrainian in Latvia was a crucial factor, as it was associated with a smoother integration process and increased job opportunities. Nadiia, who traveled to Latvia via Poland and Budapest, elaborated on this: “And I was in Latvia and here there is an opportunity to communicate in Ukrainian, in Russian” (Nadiia).

The possibility of being accepted and integrated into the local community was also mentioned as a decision-driver. Oksana shared that her father, who had previously worked in Riga, advised her to go to Latvia: “you guys, probably go to Riga, well, because you will be accepted there, accommodated” (Oksana).

Nonetheless, choosing Latvia because of the possibility to communicate in Russian does not come without complications. Nataliia B., for instance, found the topic of language stirring up strong emotions and confessed that she doesn’t wish to speak Russian anymore: “I had such a psychological reaction – I didn’t speak Ukrainian for many years, and when all these events began, I read, I remember well how I woke up in the morning and began to speak Ukrainian. My thoughts have become Ukrainian” (Nataliia B.).

Moreover, having knowledge of the Ukrainian diaspora in the country also proved an important factor. “I also found out that there is a Ukrainian diaspora in Latvia of about 50 000 people, as I heard in the Latvian news. And this also encouraged me, I realised that I could find help from my compatriots” (Nadiia). This observation underlines the role of cultural kinship in the decision-making process regarding destination, and it can indeed be seen as a decisive factor. As the diaspora expands with the influx of more displaced people, this rationale for choosing Latvia may become increasingly common.

Conclusion

The study underlying this brief provided empirical insight into the initial phases of Ukrainian war asylum seekers’ journey to Latvia in 2022, enhancing our understanding of the factors that influenced the choice of Latvia over other destinations.

Ukrainians fleeing the early stage of the 2022 Russian invasion were compelled to make swift and difficult decisions due to the pressing crisis. Leaving behind their familiar lives, properties, and dear ones – often the very individuals facilitating their exodus for safety reasons – was a harrowing reality. The support from kin and acquaintances in Latvia was crucial in endorsing their decision to seek refuge in the country.

Three groups emerged among the Ukrainian refugees in Latvia, all connected by personal relationships to some degree. The factors influencing their migration ranged from the presence of kin and considerations of employment prospects, to shared language, culture, and history. The fact that the initial outreach usually originated from the Latvian side underscores the profound solidarity and active support provided by Latvians to their Ukrainian counterparts. This likely also played a significant role in the refugees’ decisions. The pre-existing Ukrainian diaspora in Latvia, estimated at around 50 000 before the invasion, also significantly influenced the choice of Latvia as a refuge.

Financially-related factors such as seeking benefits were largely absent from the narratives, likely due to the geographic proximity, relatively low costs, and the urgent nature of the displacement. The most significant determinant in choosing Latvia as the destination appeared to be the network effect, contrasting with Robinson and Sergott (2002) findings that acute asylum seekers often settle for the first country available.

Given the emergency nature of the displacement, no unambiguous pattern in the location decision could be established. The narrative varied considerably among respondents with decisions often being made, or altered, on the fly. However, in most cases, personal relationships played a primary role in shaping the choices among Ukrainian refugees in Latvia.

For policy-makers planning and responding to acute migration crises, the study highlights the importance of mapping and understanding multifaceted kinships, as well as culture and history. The mapping can be used to plan support and allocate resources to give displaced people an opportunity of a place where they feel welcomed and connected, with hopes of greater integration.

References

  • Böcker, A. and Havinga, T. (1997). Asylum Migration to the European Union: Patterns of Origin and Destination, Luxembourg: Office for Official Publications of the European Communities.
  • Brekke, J. P. and Aarset, M. F. (2009). Why Norway? Understanding Asylum Destinations, Institute for Social Research, Oslo.
  • Collyer, M. (2005). When do social networks fail to explain migration? Accounting for the movement of Algerian asylum-seekers to the UK. Journal of Ethnic and Migration Studies, 31(4), 699-718.
  • Czaika, M. and de Haas, H. (2017). The effect of visas on migration processes. International Migration Review, 51(4), 893-926.
  • Diop-Christensen, A. and Diop, L. E. (2021). What do asylum seekers prioritise—safety or welfare benefits? The influence of policies on asylum flows to the EU15 countries. Journal of Refugee Studies.
  • Gilbert, A. and Koser, K. (2006). Coming to the UK: what do asylum-seekers know about the UK before arrival? Journal of ethnic and migration studies, 32(7), 1209-1225.
  • Gonsalves, C. J. (1992). Psychological stages of the refugee process: A model for therapeutic interventions. Professional Psychology: Research and Practice, 23(5), 382.
  • Havinga, T. and Böcker, A. (1999). Country of asylum by choice or by chance: Asylum‐seekers in Belgium, the Netherlands and the UK. Journal of ethnic and migration studies, 25(1), 43-61.
  • Kang, Y. D. (2021). Refugee crisis in Europe: determinants of asylum seeking in European countries from 2008–2014. Journal of European Integration, 43(1), 33-48.
  • Koser, K. and Pinkerton, C. (2002). The social networks of asylum seekers and the dissemination of information about countries of asylum.
  • Mallett, R., & Hagen-Zanker, J. (2018). Forced migration trajectories: An analysis of journey-and decision-making among Eritrean and Syrian arrivals to Europe. Migration and Development, 7(3), 341-351.
  • Neumayer, E. (2005). Bogus refugees? The determinants of asylum migration to Western Europe. International studies quarterly, 49(3), 389-409.
  • Neumayer, E. (2004). Asylum destination choice: what makes some West European countries more attractive than others? European Union Politics, 5(2), 155-180.
  • Ortega, F., and Peri, G. (2013). The effect of income and immigration policies on international migration. Migration Studies, 1(1), 47-74.
  • Robinson, V., and Segrott, J. (2002). Understanding the decision-making of asylum seekers (Vol. 12). London: Home Office.
  • Shultz, C., Barrios, A., Krasnikov, A. V., Becker, I., Bennett, A. M., Emile, R., Hokkinen, M., Pennington, J. R., Santos, M., and Sierra, J. (2020). The Global Refugee Crisis: Pathway for a More Humanitarian Solution. Journal of Macromarketing, 40(1), 128–143.
  • Suzuki, T. (2020). Destination choice of asylum applicants in Europe from three conflict-affected countries. Migration and Development, 1-13.
  • Tucker, J. (2018). Why here? Factors influencing Palestinian refugees from Syria in choosing Germany or Sweden as asylum destinations. Comparative migration studies, 6(1), 1-17.

Disclaimer: Opinions expressed in policy briefs and other publications are those of the authors; they do not necessarily reflect those of the FREE Network and its research institutes.

European Democracy Through the Lens of Party Manifestos

Posted on May 1, 2023 | Policy Brief

A group of flags representing European countries, displayed on flagpoles with a clear blue sky in the background representing European democracy

The subjects of political discourse are important but hard to quantify. This brief uses data from 30 years of party manifestos to study how the dominant topics in politics have evolved across Europe. Transition countries have seen the most significant shift in the content of political discourse. In the early 1990s, party manifestos in Eastern Europe focused on a distinct set of topics related to transition; by recent elections they had converged to those in Western Europe, with a heavy emphasis on the welfare state, education, infrastructure and technology. Political discourse can change rapidly in times of crisis as shown by the example of Ukraine.

“It’s the economy, stupid!”

James Carville, Bill Clinton’s strategist for the 1992 election.

The dominant topics in politics are not always as apparent as when Bill Clinton was elected US president in the midst of a recession. While it is easy to track winners across election cycles, it is much harder to know what got them elected and what they will do (or at least, promise to do) once in power. The key issues and topics that political parties and candidates talk about form as important a part in our democracies as vote shares.

In this brief, we use data collected by the Manifesto Project (Lehmann et al., 2022) to describe the development of political discourse across Europe, with a particular focus on the differences and similarities between western European countries and transition economies in Eastern Europe.

Political Manifestos as Data

In most countries, voters mainly participate in the democratic process by voting for candidates put forward by political parties. Political parties advertise themselves to voters and distinguish themselves from each other by issuing party programmes or party manifestos where they lay down their ideological and policy positions.

The Manifesto Project provides a publicly available dataset on parties’ policy platforms. The data are based on the manifestos of parties that have won at least one (Western Europe) or two seats (transition countries) in a national election. Coders manually analyse the content of the manifestos and provide the percentage of each party’s manifesto that falls into one of 56 content categories. These content categories summarise a party’s policy position on given issues, for instance, whether they favour environmental protection or an expansion of the welfare state or oppose protectionism or multiculturalism.

The Manifesto Project is an example of “text as data“. Quantitative analysis based on text is becoming increasingly important across the social sciences (Gentzkow et al., 2019) but it is particularly useful in political economy and political science given that “language is the medium of politics“ and objective numerical data are often limited (Grimmer and Stewart, 2013). Unlike many recent approaches which process data using automated text analysis tools, the Manifesto Project relies on the judgement of coders from over 50 countries who read the original text. The resultant dataset has limitations: the subjective choices made by individual coders, the to-some-extent arbitrary determination of content categories to summarise the most relevant issues across different contexts and time periods and the difficulty of imposing consistent classifications for texts written in over 40 languages. Despite these caveats, it is a unique resource for analysing the evolution of countries’ political discourse over time and across countries.

Key Issues in Political Discourse

Figure 1 summarises, through content categories, the policy positions of parliaments in Western Europe and transition countries at two points in time: the early 1990s (around the time of the first democratic elections in most transition countries) and after the latest election. We measure the importance of a policy position in a country’s parliament by weighting the importance of the relevant content category in each party’s manifesto by that party’s vote share. Over time, our measure of a policy position’s importance in political discourse may increase or decline for two reasons. First, parties may change the extent to which they emphasise a given position in their manifestos. For example, parties across the political spectrum are likely to have increased references to healthcare in their manifestos during election campaigns held during the Covid-19 pandemic. Second, as voters’ preferences shift, parties that gain support will see their issues receive greater weight in the aggregate measure relative to parties that lose vote shares. For example, if the pandemic shifted voters’ preferences towards a more comprehensive welfare system, voters could respond by voting for parties which discuss the expansion of the welfare state in their manifestos.

Figure 1. Policy positions of parties in parliament.

Source: The Manifesto Project and authors’ calculations.
Notes: This chart shows word clouds of the main topics that feature in the manifestos of political parties in parliament, weighted by each party’s vote share and averaged across countries within a region. Panels a and b are based on the first election after 1990 (and before 1995) and Panels c and d are based on the latest election (after 2015) in the sample. Western Europe includes Austria, Belgium, Denmark, Finland, France, Germany, Greece, Iceland, Ireland, Italy, Luxembourg, Netherlands, Norway, Portugal, Spain, Sweden, Switzerland and the United Kingdom. Transition economies include Armenia, Azerbaijan, Bosnia-Herzegovina, Bulgaria, Croatia, Czech Republic, Estonia, Georgia, Hungary, Latvia, Lithuania, Moldova, Montenegro, North Macedonia, Poland, Romania, Russia, Serbia, Slovakia, Slovenia and Ukraine. Not all countries are represented in both periods.

Some striking patterns emerge. While the policy priorities of Western European parliaments remain relatively stable over the past 30 years, those of transition countries have changed markedly. During the transition period, many parties focused on the political and economic aspects of transition. Support for democracy, freedom and human rights, as well as the free market economy, featured heavily in the manifestos of parties that formed the first democratic parliaments. Over time, policy priorities in transition countries have become more similar to those of their western neighbours, and issues such as the expansion of the welfare state, the provision of education, and the importance of technology and infrastructure, have come to the fore in all countries.

Nevertheless, some differences still remain. For instance, environmental protection is one of the most important topics in western European parliaments, though its importance has declined over time. In transition countries, the environment is slowly becoming more important, but even in the latest elections it ranked at only number 16 out of 56 issues. In contrast, support for the “national way of life” was and continues to be a prominent part of the political discourse in transition economies and it is also becoming more mainstream in the Western European countries.

Political corruption and governmental and administrative efficiency have become relatively more important issues in the parliaments of transition countries, both over time and relative to their western neighbours. Meanwhile, parties in Western Europe are devoting more of their manifesto to calls for equality and social justice.

A Closer Look at Ukraine

A country’s parliament’s policy platform can change suddenly in response to shocks. Figure 2 shows the big topic groups in the manifestos of political parties in the Ukrainian parliament from 1998 to 2019. The parliamentary election in October 2014 closely followed the Euromaidan Revolution, the annexation of Crimea by Russia and the start of the Donbas war. Compared to the previous elections, external relations became a major issue in the Ukrainian parliament, driven in particular by increased mentions of the military and the relationship with the EU. Party manifestos heavily featured appeals to Ukrainian nationhood, national solidarity, and unity (as evidenced by the increasing importance of the content category “Fabric of Society”). The trend of increasing attention to freedom and democracy also continued in this election cycle. In contrast, the previously most important issues in elections (welfare and quality of life) received much less attention in parliament at times of political upheaval and military conflict.

Figure 2. Topics in Ukrainian elections.

Source: The Manifesto Project and authors’ calculations.
Notes: This chart shows the percentage of mentions of topic groups in the manifestos of political parties in the Ukrainian parliament from 1998 to 2019, weighted by each party’s vote share.

Distribution of Political Ideology

While the previous section discussed the main policy issues in parliament, we now turn our focus to the ideology of individual political parties that make up a country’s parliament. A commonly used summary measure of political ideology is a left-right scale (RILE), where left positions favour peace, state intervention in the economy and the expansion of the welfare state and right positions support security, traditional values and the free market economy. The Manifesto Project provides a RILE value for each party at each election (based on Laver and Budge, 1992), which is calculated by subtracting the share of a party’s manifesto devoted to left-leaning policy issues, for instance support for the welfare state, from right-leaning content, such as support for the free market economy. Condensing the complexity of party programmes into a one-dimensional measure based on fixed definitions has advantages and drawbacks. The RILE makes it possible to compare diverse political parties that campaign on different issues (for instance ecological parties compared to nationalist parties) and measure how the same party’s policy stance may have shifted over time. As the definition of left- and right-leaning issues were based on influential political theories around the 1900s, some scholars argue that this measure has become less appropriate to empirically differentiate between modern political parties, particularly in transition countries (see, e.g., Mölder, 2016). In particular, Tavits and Letki (2009) show that during the transition process many leftist parties in Eastern Europe pursued economically right-wing policies and Vachudova (2008) argues that right-wing parties in the region often appealed to a nationalist discourse.

With these caveats in mind, Figure 3 shows the distribution of all parties in parliament in the Manifesto Project database on the RILE scale, weighted by their respective vote shares. In Western Europe in the 1990s, the chart shows the prominence of both centre-left and centre-right parties, as well as smaller parties both on the more extreme left and right. In contrast, the parties in parliament in transition economies at the time were more concentrated in the centre (and slightly towards the right). Fast forward 30 years and the distribution of political ideology has changed in both the east and the west. In Western Europe, the majority of parliamentarians are now situated slightly right of centre with little mass in the more extreme tails. In contrast, in the former transition countries, there is evidence of political polarisation with party representation moving both to the left and the right on the ideological spectrum and relatively few parliamentarians occupying the centre.

Figure 3. Left-right position of parties in parliament.

Source: The Manifesto Project and authors’ calculations.
Notes: This chart shows the density of parties in parliament on the left-right policy scale (RILE), weighted by each party’s vote share within their country. The dashed lines are based on the first election after 1990 (and before 1995) and the solid lines are based on the latest election (after 2015) in the sample. Western Europe includes Austria, Belgium, Denmark, Finland, France, Germany, Greece, Iceland, Ireland, Italy, Luxembourg, Netherlands, Norway, Portugal, Spain, Sweden, Switzerland and the United Kingdom. Transition economies include Armenia, Azerbaijan, Bosnia-Herzegovina, Bulgaria, Croatia, Czech Republic, Estonia, Georgia, Hungary, Latvia, Lithuania, Moldova, Montenegro, North Macedonia, Poland, Romania, Russia, Serbia, Slovakia, Slovenia and Ukraine. Not all countries are represented in both periods.

Conclusion

What are the main topics of political discourse? Are they different across countries? Do they change over time? While there is no perfect way to quantify and track political discourse over time, this brief uses data from parties’ manifestos provided by the Manifesto Project to illustrate some broad trends across Europe over the past 30 years.

We document two kinds of changes in the subject matter of party manifestos. First, there are gradual shifts in content that reflect underlying developments in society. As democracies have matured in Eastern Europe, the content of their parties’ manifestos has evolved away from the immediate concerns of economic and political transition and converged to those of Western European parties. Second, more abrupt shifts can arise when countries experience crises or institutional upheaval. Over the past decade Ukrainians have lived through a revolution, the Donbas war, and the ongoing Russian invasion. Most of the parties that represent them in parliament are new, and the issues that feature prominently in their manifestos are now markedly different from those before the Euromaidan revolution.

Manifestos are not just about substance but also about ideology. Using the Manifesto Project’s classification of parties on a left-right scale, we show how the distribution of parties has evolved in Western Europe and transition countries. By this measure, political polarisation has been increasing in transition countries where centrist positions are less well represented than in Western European parliaments.

References

  • Gentzkow, Matthew, Bryan Kelly, and Matt Taddy. (2019). “Text as data”, Journal of Economic Literature 57, no. 3: 535-74.
  • Grimmer, J., and Stewart, B. (2013). “Text as data: The promise and pitfalls of automatic content analysis methods for political texts”. Political analysis 21, no. 3: 267-297.
  • Lehmann, P., Burst, T., Matthieß, T., Regel, S., Volkens, A., Weßels, B. and Zehnter, L. (2022) The Manifesto Data Collection. Manifesto Project (MRG / CMP / MARPOR). Version 2022a. Berlin: Wissenschaftszentrum Berlin für Sozialforschung (WZB). https://doi.org/10.25522/manifesto.mpds.2022a
  • Laver, M. and Budge, I. (eds.). (1992). Party Policy and Government Coalitions, Houndmills, Basingstoke, Hampshire: The MacMillan Press.
  • Mölder, M. (2016). The validity of the RILE left–right index as a measure of party policy. Party Politics, 22(1), 37–48. https://doi.org/10.1177/1354068813509525
  • Tavits, M. and Letki, N. (2009). When Left Is Right: Party Ideology and Policy in Post-Communist Europe. American Political Science Review, 103(4), 555-569. doi:10.1017/S0003055409990220
  • Vachudova, M. A. (2008). Centre—Right Parties and Political Outcomes in East Central Europe. Party Politics, 14(4), 387–405. https://doi.org/10.1177/1354068808090252

Disclaimer: Opinions expressed in policy briefs and other publications are those of the authors; they do not necessarily reflect those of the FREE Network and its research institutes.

Georgian Economy and One Year of Russia’s War in Ukraine: Trends and Risks

Posted on March 13, 2023 | News

20230228 Georgian economy and one year of Russia Image 01

Russia’s invasion of Ukraine profoundly impacted the global economy, immediately sending shockwaves across the globe. The attack of a country that was once a major energy supplier to Europe on the country which was one of the top food exporters in the world, sent food and fuel prices spiralling, causing major energy shortages and the prospect of protracted recession in the United States and the European Union.

The unprovoked and brutal aggression resulted in nearly universal condemnation and widespread sanctions placed on Russia by the United States, the EU, and other Western allies. Financial sanctions were perhaps the most unexpected and significant with the potential for immediate impact on Russia’s neighbours, including those that did not formally join the sanctions regime. In addition to sanctions, the major consequence of the war was mass migration waves, particularly from Ukraine, but also from Russia and Belarus to neighbouring countries.

At the start of the war, it was expected that the Georgian economy would be severely and negatively impacted for the following reasons:

  • First, as a former Soviet republic, Georgia historically maintained close economic trade ties with both Russia and Ukraine. The ties with Russia have weakened considerably in the wake of the 2008 Russo-Georgian war but remained significant. Russia was the primary market for imports of staple foods into Georgia, such as wheat flour, maize, buckwheat, edible oils, etc. Russia and Ukraine were both important export markets for Georgia. Russia was absorbing about 60 percent of Georgian wine exports and 47 percent of mineral water exports, while Ukraine was one of the leading importers of alcohol and spirits from Georgia (46 percent of Georgia’s exports). Tourism and remittances are other areas where Georgia is significantly tied to Russia and somewhat weaker to Ukraine. Before the pandemic, in 2019 Russia accounted for 24 percent of all tourism revenues, while Ukraine for 6 percent. Remittances from Russia accounted for 16.5 percent of total incoming transfers in 2021.
  • Second, while the Georgian government chose to largely keep a neutral stance on the war (announcing at one point that they would not join or impose sanctions against Russia), the main financial and trade international sanctions were still in effect in Georgia due to international obligations and close business ties with the West. These factors were reinforced by strong support for Ukraine among the Georgian population, where the memory of the Russian invasion of Georgia in 2008 remains uppermost.
  • In addition, Georgia is a net energy importer, and while the dependence on energy imports from Russia is not significant, the rising prices would have affected Georgia profoundly.

Original publication: This policy paper was originally published in the ISET Policy Institute Policy Briefs section by Yaroslava Babych, Lead Economist of ISET Policy Institute. To read the full policy paper, please visit the website of ISET-PI. 

Disclaimer: Opinions expressed in policy briefs and other publications are those of the authors; they do not necessarily reflect those of the FREE Network and its research institutes.