| Abstract: | Abstract This paper deals with the economic relations between Russia, Ukraine and the enlarged European Union. We start with some essential characteristics regarding the huge gaps in the size and trade structures of these three economic entities, before briefly outlining the development of their institutional relations. We discuss the impacts of EU enlargement on Russia and Ukraine, as well as the prospects for Russia—Ukraine relations. Given all the complexities of these relations, the mutual interdependence and the uncertainties concerning the future, we conclude that rather than devising grand new schemes, Russia, Ukraine and the EU should focus on practical steps that would facilitate closer cooperation in areas such as the development of border regions, the implementation of a free trade area and the support of economic reforms. Regarding Ukraine, whose official aspirations of EU membership seem highly unrealistic at least in the medium term and whose already high economic dependency on Russia is becoming even more pronounced, the policy challenges will be formidable. Whether Ukraine will succeed in a fine-tuned balancing act to establish closer relations with both the enlarged EU and Russia simultaneously, remains to be seen. Concerning economics, Ukraine's already intense eastward integration may even deependespite Ukraine possibly getting more hearing in the EU at the insistence of some new member states. |
