Austrian Neutrality: A Model for Ukraine

March 6, 2014 Topic: Global Governance Region: AustriaUkraine

Austrian Neutrality: A Model for Ukraine

In 1955, another country torn between Russia and the West managed to achieve independence. Austria's example deserves closer examination.


The crisis in Ukraine is spinning slowly out of control. An aggressive Russia under the leadership of a man who once deemed the end of the Soviet Union “the greatest geopolitical tragedy of the 20th century” is pursuing a neo-Soviet foreign policy for Ukraine to remain firmly in Russia’s orbit—an effort doomed to fail due to the deep political rift dividing the country. Consequently, given this neo-Soviet style of Realpolitik, it may be wise to examine the history of Soviet foreign policy under ostensibly similar circumstances in Europe to inform the present day debate surrounding Ukraine.

The most obvious scenario is the Allied-Soviet negotiations between 1945-1955 over the fate of Austria, which eventually concluded with Austria’s declaration of “perpetual neutrality,” the departure of all Soviet and Allied military forces from Austrian soil in 1955, and the ratification of the Austrian Independence Treaty in the same year. Likewise, neutrality also may be Ukraine’s most viable option. In fact, the now discredited Viktor Yanukovich stated in his inauguration 2010 “challenges that the international community face mean we have to join together in a larger format. We are ready to participate in this process as a European, non-aligned state.”[1] Indeed in the Declaration of State Sovereignty of Ukraine, passed on July 1, 1990, it says that Ukraine has the “intention of becoming a permanently neutral state that does not participate in military blocs and adheres to three nuclear free principles…”[2] To this date, however, no further steps have been taken towards Ukrainian neutrality.


After Austria’s defeat as part of the Third Reich (1938-1945) in the Second World War, Austria roughly faced five distinct potential futures.

First, the country could become another European “People’s Democracy” dominated by the Soviet Union. However, the U.S. Marshall plan beginning in the summer of 1947 and the fact that only parts of Austria were under direct Soviet control made this an unviable option for Soviet leadership.

Second, Austria could have turned entirely towards the West. Some influential Austrian politicians advocated NATO membership as early as 1949, yet the Soviet Union was opposed to such an endeavor for obvious reasons and would not withdraw its troops, knowing Austria would join the Western alliance.

Third, Austria could have been divided on the lines of occupied Germany as two separate states. This fear was especially acute during the years of the West Berlin blockade (1948-1949). A split-up, however, was not in the Soviet Union’s interest since the strategically important Western half of Austria quickly would have joined NATO.

Fourth, Austria could have remained permanently occupied by Allied and Soviet forces if no political solution was found, which was not a farfetched scenario given the occupation and breakup of Germany during the Cold War.

Last and the most relevant to Ukraine, Austria could have opted to become another buffer state between the East and West—a “second Switzerland”—and declare its neutrality.

Ukraine today faces similar options as Russian troops settle into Crimea: side with the “East”, side with the “West”, break up the country, or restore territorial integrity in exchange for neutrality. Of the four options, neutrality appears to be the most viable scenario. A closer look at the Soviet position in 1955 vis-à-vis Austria is warranted.

Two factors made the Soviet Union agree to the withdrawal from Austrian soil in April 1955—economic concessions and the guarantee that Austria would remain militarily neutral during the ongoing Cold War.

The Soviet Union had economic interests in both oil fields in lower Austria as well as Austrian-based German companies seized by the Soviets after the war. The Soviets only eventually conceded to a withdrawal based on a rigorous reparation and compensation plan proposed by a French official called the “Cherrière-Plan”.

On the national-security front, Austria agreed to remain neutral in the ongoing Cold War by not joining either of the two military alliances or allowing the stationing of foreign troops on Austrian soil.

Other issues that ultimately were resolved during negotiations were the status of the Croatian and Slovene minorities in the country, the prohibition of another “Anschluss” with Germany, and the role of former Nazis in Austrian politics.

All of this, next to other external political developments, cleared the way for the Austrian Independence Treaty of May 15, 1955, making Austria a de facto buffer state between East and West. De jure neutrality was guaranteed by the enshrinement of a “perpetual neutrality” clause in the constitution of the Austrian Second Republic in October of the same year.

As Victoria Potapkina points out in a paper discussing Ukraine neutrality and using Austria as a case study: “The key country to Austria’s situation was the Soviet Union (USSR) toward which it had to pledge not only military, but also ideological neutrality.”

This has two implications for the current political crisis in Ukraine.

First, the economic interests of Russia must be satisfied in order for her to save face. For example, a symbolic short-term guarantee that Ukraine will remain dependent on Russian oil and gas in the intermediate term by stalling drilling concessions to Western oil companies such as the Exxon Mobile Corp. and Royal Dutch Shell in exchange for nonintervention in Ukrainian domestic affairs could be a start. (In return Putin will certainly have to say goodbye to Ukraine joining his Eurasian Union, which at this stage is no longer a real option in any case.) Also, perhaps the heavy industry sites in eastern Ukraine could be declared special economic zones (SEZ). From the side of the IMF and the West, this must be matched with substantial financial aid (The country owes $13 billion in debt this year) over a short amount of time—a “Ukrainian Marshall Plan”—to ensure Ukrainian economic development and alleviate any public outcry such concessions most likely would cause. The European Union has already pledged a $15 billion USD aid package, which is a step in the right direction. In the long term the Ukrainian economy will need to diversify, and the United States has promised aid to that effect in the amount of a $1 billion USD loan guarantee (Trade with Russia is already in decline. Less than 6 percent of Russia’s foreign trade is going to Ukraine).

Second, Russia’s security concerns must be alleviated. Multilateral negotiations (perhaps under the auspices of the UN or OSCE) should be initiated immediately to outline a nonaligned, perpetually neutral Ukraine in Kiev, Moscow, Washington, and Brussels. As Mykola Sungurovskiy from the Razumkov Center points out: “Presence of militarily mighty neighbours involves the need of reliable external guarantees of neutrality.”[3] Ukraine neutrality will only be an option if a binding agreement with the European Union, Russia and the United States as guarantors can be signed. As the case of the “Budapest Memorandum”[4] shows, nothing short of a formal treaty will do in this case. As in Austria and Switzerland, the added benefit of this on the domestic front could be the forging of a new Ukrainian national identity based on a perception of neither being in the “Eastern” or “Western” camp.

Austria sacrificed the province of Southern Tyrol to gain full independence; Ukraine will, in all likelihood, have to concede the Crimea, if not additional territories in the East. In addition, a host of internal issues still must be resolved in a neutral Ukraine: ethnic tensions, ultranationalism, the membership of Ukraine in the Commonwealth of Independent States and other international organizations, a viable economic strategy, a plan to diminish the influence of the oligarchs and a strategy to fight corruption, among others.

A further breakup or military conflict in Ukraine is in no one’s interest, and space still remains for maneuvering. The geographic proximity to Russia and Ukraine’s energy dependence will certainly show the limits of genuine Ukraine neutrality. Still, a diplomatic dialogue among all key actors involved on the subject may have a defusing impact. As the I.R. scholar Viktoria Potapkina concludes in a paper entitled “Ukraine’s Neutrality: A Myth or Reality” in 2010: “Neutrality can be considered as one of the main feasible solutions to certain ongoing problems in Ukraine.” Ukrainian neutrality appears to be the least conflict-prone choice; therefore, diplomats carefully should study the negotiation process leading to the Austrian State Treaty of 1955. Despite various differences, it is a unique case study of the establishment of a buffer state in a much-contested geographic region, including how it maintained its territorial integrity and its political independence.

Franz-Stefan Gady is a senior fellow at the EastWest Institute, where he was a program associate and founding member of the Worldwide Cybersecurity Initiative. Follow him on Twitter (@HoansSolo).

Image: Wikimedia Commons/Russian Embassy in Austria. CC BY-SA 3.0.