Commentary on the economic , geopolitical and simply fascinating things going on. Served occasionally with a side of snark.
Sunday, May 18, 2014
Ukraine News For May 18 , 2014 --East Ukraine’s Kharkov region to hold independence referendum - movement “Southeast” ...... Germanys saying " Nein " as to more sanctions ? ( German Foreign Minister Frank-Walter Steinmeier has called for restraint in imposing new sanctions on Russia, as politicians, businesses and the general public in Germany grow ever more skeptical of putting more pressure on Moscow. ) ....... referendum - movement “Southeast” ...... Germanys saying " Nein " as to more sanctions ? ....... Ukraine needs federalization; decentralization not enough - Luhansk Regional Council head ........ Tymoshenko suggests referendum on NATO, EU membership, government system during presidential election
Donetsk (Ukraine) (AFP) - Without even firing a shot, masked rebel gunmen overran a Ukrainian military headquarters in the main eastern city of Donetsk on Friday and swiftly declared they were in control.
After a couple of hours of what one local described as "negotiations", uniformed members of a National Guard special forces unit simply took off in a few trucks, leaving the building to the rebels.
Ukraine's military offensive against pro-Russian insurgents in the east, already a month old, has so far been a humiliating failure, with separatists now firmly in control of large swathes of the country's industrial heartland.
Despite its superior military firepower, the Ukrainian army is running into almost nightly confrontations with well-armed insurgents barricaded in a dozen towns and cities.
It has lost at least a dozen men, seven of them this week in a single bloody ambush near the epicentre of the uprising in Slavyansk.
"The operation has proved to be ineffective because Ukrainian forces were not prepared," said military expert Mykola Sungurovsky.
Yaroslav Gonchar, deputy battalion commander of the Azov volunteer unit in the Ukrainian National Guard, pulled no punches in apportioning blame.
"At the local level, we faced betrayal by the police and the opposition of the local people, as well as the incompetence of those planning the operation," he said.
- 'No repeat of Crimea' -
Ukraine's new leaders launched the "anti-terrorist" operation on April 13 after gunmen sought to capitalise on Moscow's annexation of Crimea in March and began overrunning city halls, police stations and military barracks across the far east.
The army moved in with clear objectives -- to disarm the rebels, clear them from scores of occupied buildings and reestablish Kiev's authority over the region.
"We will not allow Russia to repeat the Crimea scenario in the east of Ukraine," interim President Oleksandr Turchinov has vowed.
But the human cost has been high, with the UN on Friday putting the number of dead in the southeast at 127 -- exceeding the toll from the bloodletting in Kiev earlier this year during pro-EU protests that saw the ouster of the corruption-stained Kremlin-backed president.
And since the Russian takeover of Crimea, rebels are now claiming control of the main industrial regions of Donetsk and Lugansk, although residents say it is not really clear who is actually running things on the ground.
The two regions -- home to seven million of Ukraine's 46 million population -- declared themselves independent "republics" after claiming victory in weekend referendums denounced as illegitimate farces by Kiev and the West.
Donetsk, the larger of the two and the hub of Ukraine's sprawling coal and steel industry, has already asked Moscow if it can join the Russian Federation.
From the first days of the offensive, the Ukrainians had to deal with a number of embarrassing blows. Several military helicopters were shot down and tanks and armoured vehicles were seized by the rebels.
- 'Dialogue not force' -
There are almost daily reports of roaming gunmen storming government buildings, police stations and abducting local political and military officials, but not all the claims can be verified.
Ukraine, the International Crisis Group warned in a grim report this week, is "running out of time".
"Shaken by the separatist agitation and distracted by Russian troops on its border, (the interim government) has not asserted itself coherently," the think-tank said.
"Military efforts to restore order in the southeast have underlined both the government's weakness and the pressing need for a solution through political dialogue not force."
The ICG's views were echoed by Volodymyr Fesenko at the Penta centre for political studies in Kiev.
"There has been no real achievement. Ukrainian forces have absolutely no way of restoring order in the region," he said.
"It's not possible to keep the Donbass (the term for the Donetsk/Lugansk region) by force. It can only be achieved through negotiations."
Fesenko said it was vital for the Kiev authorities to bring on board local political and business heavyweights such as Ukraine's richest man, billionaire powerbroker Rinat Akhmetov.
Akhmetov, an influential force in the east with his vast industrial empire, has kept to the middle ground in the confrontation, walking a fine line between Kiev's pro-West authorities and the rebels.
If the military offensive is not rapidly accompanied by political dialogue, Fesenko warned, the east will become a new Transdniestr -- the pro-Russian separatist region of Moldova.
"And there could be even worse outcomes: a long drawn-out war and an escalation of the violence, in other words the Yugoslav scenario," he warned.
Eastern Ukraine, Kyiv argue over 'terrorists' in crisis-torn areas
Criticism comes in the 2nd round of European-brokered talks intended to resolve the country's political crisis
The Associated PressPosted: May 17, 2014 5:54 PM ET Last Updated: May 17, 2014 6:44 PM ET
Pro-Russian militants walk to their positions to fight against Ukrainian government troops at a checkpoint blocking the major highway which links Kharkiv, outside Slovyansk, eastern Ukraine. (Alexander Zemlianichenko/Associated Press)
Lawmakers and officials from eastern Ukraine on Saturday poured criticism on the fledgling central government, accusing it of ignoring legitimate grievances of the regions which have been overrun by pro-Russia militia fighting for independence.
One eastern leader said last weekend's unofficial referendum in favour of independence "expressed the will of the people."
The criticism came in the second round of European-brokered talks intended to resolve the country's worst crisis since the fall of the Soviet Union in 1991.
Ukraine's caretaker government came to power in February following the ouster of Kremlin-friendly President Viktor Yanukovych after months of protests in Kyiv. Moscow and many in Ukraine's east have accused the new government of intending to trample the rights of eastern Ukraine's Russian-speakers.
On Saturday, politicians from the east implored the government to believe that — apart from the pro-Russia gunmen — a large sector of the population had lost hope in the interim administration in Kyiv.
The second round of talks followed hours after sustained gunfire heard throughout the night near the eastern city of Slovyansk, the stronghold of pro-Russia fighters, after forces loyal to the Kyiv government moved in to protect a television tower.
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Separatists in the Donetsk and Luhansk regions held hastily arranged referenda last weekend and declared independence following the vote, which went in favour of sovereignty.
The round-table talks in the eastern city of Kharkiv did not feature any of the insurgents, whom Kyiv describes as terrorists. The insurgents say they are willing to discuss only the withdrawal of Ukrainian troops and the recognition of the independence of the regions.
"The referendum doesn't have any legal consequences," said Valery Holenko, chairman of the Luhansk regional government. "But it has expressed the will of the people, which cannot be discounted. People genuinely went en masse to the referendum. This was a protest vote."
Holenko said the devolution of powers that the government is offering was no longer enough and that as a first step in appeasing eastern Ukrainians the government has to stop its "anti-terrorist operation" in the east.
Acting Prime Minister Arseniy Yatsenyuk, who was often busy with his iPad while some of the eastern lawmakers were making passionate speeches, called on the eastern leaders to resist the armed men and support the government's efforts to devolve powers to the regions.
A pro-Russian militant rests at a checkpoint outside Slovyansk in eastern Ukraine. The armed separatists installed a new check-point on the eastern approaches of the city to block the major highway that links Kharkiv. (The Associated Press)
"You have got in your home, in Luhansk and Donetsk, armed terrorists who are funded by Russians and those who fled Ukraine and want to seize our land," Yatsenyuk told the gathering.
"We're not going talk to robbers and terrorists. They will not be telling the Ukrainian people how to live in our country."
Yatsenyuk urged the eastern leaders to disarm the insurgents, "regain the power and start a political dialogue."
Reacting to calls to make Russian a second official language, Yatsenyuk said the government will support the equal status of Ukrainian and Russia in Russian-speaking regions but sees no need for other legal protection.
Reacting to the fighting overnight near Slovyansk, the Russian Foreign Ministry issued a statement condemning what it described as a sharp escalation of violence in eastern Ukraine, and accused Kyiv of using the talks as cover for military operations against its citizens.
The ministry said some people were wounded, but gave no specifics.
Debris from the shooting was visible Saturday morning, including a badly damaged train and craters caused by mortar bombs or other heavy artillery.
'We're not going talk to robbers and terrorists. They will not be telling the Ukrainian people how to live in our country.'- Ukrainian Prime Minister Arseniy Yatsenyuk
Government forces in recent weeks have achieved only limited results in quashing the self-styled Donetsk and Luhansk "people's republics," which declared independence for their regions following the contentious votes on independence.
Polls have shown, however, that a majority of eastern Ukrainians support a united country, although most are too fearful of the armed separatists to say so publicly.
As on Wednesday, Saturday's talks included officials, lawmakers, business people and religious leaders from across the country, but no representatives of the separatists from Donetsk and Luhansk.
Oleksandr Bandurka, a Communist party lawmaker and police general from central Ukraine, said that these negotiations make no sense because "we're not talking to those who oppose us. We cannot ignore them."
Ukraine's first president, Leonid Kravchuk, who is chairing the talks, angrily reacted that "no one in the world talks to killers and terrorists. Putin doesn't talk to terrorists."
Russia has pushed for the federalization of Ukraine, since that would allow Moscow to retain influence over areas in Ukraine dominated by Russian-speakers. Many in western Ukraine and in the capital favour closer ties to Europe and fear being pulled back into Moscow's orbit.
Volodymyr Groisman, acting prime minister in charge of the reforms to decentralize the government, countered the claims of some eastern lawmakers that only federalization — as proposed by Moscow — will bring peace to Ukraine.
"You were saying the unitary system of government is no longer effective?" Groisman said. "An inefficient government and dirty politics — this is what led to the fact that so many people in our country are poor."
Attempting to end the talks on a conciliatory note, Yatsenyuk quoted Ukrainian poet Taras Shevchenko and told the leaders from eastern Ukraine: "We are ready to embrace you and hope that you are too."
The next round of talks is expected on Wednesday in the central city of Cherkasy.
East Ukraine’s Kharkov region to hold independence referendum - movement “Southeast”
Self-proclaimed Lugansk People’s Republic elects its leader
LUGANSK, May 19, 0:02 /ITAR-TASS/. Valery Bolotov was on Sunday elected as head of the self-proclaimed Lugansk People’s Republic, the press service of the combined army of the Ukrainian southeast said.
He was elected at a session of the republic’s assembly, which also approved a temporary constitution of the republic.
Vassily Nikitin has been elected Prime Minister of the LPR. The first-priority move of the head of government of the LPR is to form a Cabinet of Ministers of the proclaimed LPR, Nikitin told Itar-Tass on Monday in an interview.
"My first steps at the post of the Republic's Prime Minister will be to form a government. I shall announce specific candidacies later on," he said.
East Ukraine’s Kharkov region to hold independence referendum - movement “Southeast”
KHARKOV, May 18 /ITAR-TASS/. East Ukraine’s Kharkov region will hold a regional independence referendum following south-eastern Ukrainian cities of Donetsk and Lugansk, member of the coordinating council of movement “Southeast” Yuri Apukhtin said at a rally near the monument to Soviet leader Lenin on the Square of Freedom in this Ukrainian city on Sunday.
“Kharkov region will hold a referendum on independence following Donetsk and Lugansk. Our task is not to participate in Ukrainian presidential elections in any case. We should meet on this square on May 25. We do not recognise these elections,” he stated.
Meanwhile, Apukhtin criticised the second all-Ukraine national unity roundtable meeting in the city of Kharkov on Saturday. In his words, he refused to participate in this meeting, though he was invited to attend it.
Representatives from movements “Southeast”, “Borba” (Struggle) and the Ukrainian Communist Party are participating in the rally on the Square of Freedom. Many demonstrators came with Russian national flags.
'It’s a dead end': German FM joins chorus of discontent over sanctions rhetoric
German Foreign Minister Frank-Walter Steinmeier has called for restraint in imposing new sanctions on Russia, as politicians, businesses and the general public in Germany grow ever more skeptical of putting more pressure on Moscow.
Steinmeier defended the already imposed sanctions against Russia, but said that he still preferred "cooperation instead of confrontation" with Moscow, according to a Saturday interview with Thüringische Landeszeitung.
“We must avoid falling into an automatic [sanctions] mode, which leads only to a dead end and leaves no more policy options,” Steinmeier said.
The comment was made the same day Ukraine's acting Foreign Minister Andriy Deshchytsia appealed for toughening sanctions, including imposing “preventive” ones, against Russia in an interview to another German newspaper, Die Welt.
The idea of slapping Moscow with any further restrictions appears to be lacking popular support in Germany. That was felt earlier this week in Berlin when Chancellor Angela Merkel, attending her party’s campaign event, was booed by a rally of protesters holding signs, which read 'Europe is strong only with Russia' or 'Stop the Nazis in Ukraine.'
German business is also unhappy with the attempts to hit Moscow hard with the sanctions. A confidential letter to the German government from the German-Russian chamber of foreign trade, which was leaked to Reuters by an official in Berlin warns of the boomerang effect the sanctions would have on the European economy.
"Deeper economic sanctions would lead to a situation where contracts would increasingly be given to domestic firms, projects would be suspended or delayed by the Russian side, and Russian industry and politicians would turn to Asia, in particular China," the letter reads.
The plea to the government also says the loss of market share for German and European firms, resulting from sanctions, would be "long-term and sustained", causing "irreparable damage" to Germany's competitive position.
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More than 6,000 German firms are doing business in Russia and trade between the two countries accounts for 300,000 jobs in Germany.
The economic risks have so far not stopped Merkel from threatening Russia with more sanctions. She has been criticized for this by her predecessors, ex-chancellors Gerhard Schroeder and Helmut Schmidt.
Schmidt slammed the EU bureaucrats on Friday, accusing them of “megalomania” and attempts at “annexing Ukraine.” He told the Bild Daily that "the officials and bureaucrats in Brussels ... are confronting Ukraine with the apparent necessity of having to choose between West and East."
German Economy Minister and Vice Chancellor Sigmar Gabriel shared the opinion on Wednesday. While the politician laid the major portion of blame for the Ukraine crisis on Russia, he also admitted flaws in the EU’s policy.
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"It was certainly not smart to create the impression in Ukraine that it had to decide between Russia and the EU," Gabriel said, as cited by Reuters.
They might be multiplying, but voices of discontent over EU’s policy on Russia are so far unlikely to stop Brussels' sanctions rhetoric, according to director of a Paris-based think tank, the Institute of Democracy and Cooperation, John Laughland.
“The West is engaged in all-out ideological and geopolitical struggle with Russia, which it intends to win,” Laughland told RT. “There are all sorts of things Europe can do. It can ratchet up what it’s already done. It can publish longer lists of people who are subject to personal sanctions. It will definitely abandon the visa liberalization program, which Russia has been requesting for nearly a decade now. And it can even reduce economic exchanges. Russia should not be under any illusions – the European elites are prepared to cut off their nose to spite their face. In other words, they are prepared to undergo or make other people undergo severe economic pain in order to justify and entrench their ideological hostility to Russia.”
This handout picture released by the Poroshenko press service shows Ukrainian independent presidential candidate Petro Poroshenko (R) being greeted by supporters during an election campaign rally on May 17, 2014, in the industrial Ukrainian city of Kryvyi Rih, in the Dnipropetrovsk region. Kiev and the West accuse Russia of fomenting the chaos in eastern Ukraine in a bid to destabilise the former Soviet Republic in the run-up to planned presidential elections on May 25. Russia denies the charges and accuses the pro-Western government in Kiev -- which it refuses to recognise -- of waging "war on its own people". AFP PHOTO
Ukrainian billionaire businessman and presidential candidate Petro Poroshenko says he knows he's on the right track politically because Russia has seized the accounts of his chocolate business.Poroshenko owns Roshen, Ukraine's biggest confectionary company which has factories across eastern Europe and in Russia.
Ukraine needs federalization; decentralization not enough - Luhansk Regional Council head
The decentralization of the government system in Ukraine being proposed by Kyiv cannot affect the situation in the eastern parts of Ukraine, says Valeriy Holenko, the chairman of Luhansk Regional Council.
"Decentralization of government is already unable to settle the issue and calm the people down today. In my view, it is necessary to announce resolutely and clearly that Ukraine should become a federal state or at least that Luhansk and Donetsk regions should be granted this status. The Russian language is also an issue. In my view, this is what still can save Ukraine from disintegration today," Holenko said at an all-Ukrainian roundtable conference in Kharkiv on Saturday.
He called on the roundtable conference participants not to underestimate the results of the referendums held recently in Luhansk and Donetsk regions.
"It's true that masses of people came to this referendum and that the people truly voted the way it was announced. This was a protest not even for the formula proposed in the ballots. The people protested because they don't want to live in a country it's become now, where the people in the southeast, particularly Donetsk and Luhansk regions, are not respected and their opinion is disregarded," he said.
Ukraine is losing time from day to day and "may reach a point of no return," he said.
"There is still a chance to preserve the country. It's necessary to stop the antiterrorist operation against your own people and stop the military actions," Holenko said addressing the Kyiv authorities.
Tymoshenko suggests referendum on NATO, EU membership, government system during presidential election
The Ukrainian presidential candidate, leader of the Batkivschyna Party, and former prime minister, Yulia Tymoshenko, has suggested holding a referendum on the day of the presidential election that will include the issues of the country's foreign policy, the government system and relations with NATO.
"At present, people in eastern and southern Ukraine live with the idea of a referendum. I would like to offer the people of Ukraine, and the political elite to put several issues to a referendum, and it would be good to hold it during the presidential elections," she said on Thursday at a meeting with representatives of the Ukrainian Council of Churches and Religious Organizations.
According to Tymoshenko, Ukraine needs to clearly define its foreign policy strategy.
"If this is the European Union, the issue of the EU membership should be put on the agenda, because we need to decide, we cannot be in a 'gray zone'," she said.
The Batkivschyna leader also suggested asking Ukrainian people in a referendum whether they want Ukraine to be a unitary country with local government having more powers.
"I believe that it is also time to raise the third issue - how Ukrainians see the way to protect our borders, including by military means. Do Ukrainians support the accession to NATO or maintaining neutral status," Tymoshenko said.