Commentary on the economic , geopolitical and simply fascinating things going on. Served occasionally with a side of snark.
Friday, May 30, 2014
Ukraine Updates May 30 , 2014 -- Kiev continues Special Op in restive East , Kiev continues to fail to pay its Gazprom natural gas bill , Nato tries to pressure France to renege on ship deal with Russia ......
RF minister: Gazprom has more grounds to seek arbitration over gas dispute with Ukraine
May 30, 22:17UTC+4 Ukraine’s parliament-appointed Minister of Energy said that Kiev was ready to file a suit against Russia to the court of arbitration in Stockholm to make Gazprom revise its contract prices for gas
BERLIN, May 30. /ITAR-TASS/. Russia’s gas utility Gazprom has much more grounds to seek arbitration on the gas dispute that Ukraine, Russian Energy Minister Alexander Novak said on Friday after the gas consultations involving Russia, Ukraine and the European Commission.
“We think Gazprom has more grounds to appeal to arbitration court that the Ukrainian side,” he told journalists. “It is a long procedure and we don’t think it is constructive. It would be right to try to reach an agreement off arbitration bodies.”
Earlier on Friday, Ukraine’s parliament-appointed Minister of Energy and Coal Industry Yuri Prodan said that Kiev was ready to file a suit against Russia’s Gazprom to the court of arbitration in Stockholm to make Gazprom revise its contract prices for gas.
Russia energy minister says gas talks with Ukraine, EC constructive
BERLIN, May 30. /ITAR-TASS/. Gas talks Russia held with Ukraine and the European Commission were "constructive", Russian Minister of Energy Alexander Novak said on Friday after the third round of gas consultations in Berlin.
Advance payment regime for Russian gas supplies to Ukraine in June is not ruled out as of yet, Novak added. Russia is worried over Ukraine’s financial situation, bearing in mind its debts for Russian gas, he stressed.
“We discussed the issue of financial aid to Ukraine from the European Union, international crediting organizations,” he said. “The Russian side expressed serious concern over the financial aspects of the Ukrainian crisis.”
“Payment arrears do not add trust to the relations between partners, steps are needed to re-build it,” Novak said, adding that Russia waited for Kiev to repay “at least those debts it does not challenge."
On Monday, Yatsenyuk said that gas talks with Russia would end with either signing of a new gas agreement or with Kiev’s appeal to the international court of arbitration. Ukraine, in his words, had prepared a package of documents for that.
“Liabilities are considered discharged not at the moment of money transfer but at the moment of its passing to the account of the creditor, that is to the Gazprom account," Medvedev said.
“When Gazprom receives the money, we will see it, and that will be a different story. But today we must make sure that Ukraine is willing to pay,” he stressed. “Any other presentation of the problem is impossible: when I hear them saying ‘give us other price and then we will pay,’ I think that’s preposterous, reliable partners do not behave that way, and even less reliable partners never do that.”
He said he hoped Ukraine would finally pay what it owed for the Russian gas.
Gas talks in Berlin coincide with deadline for Ukraine’s debt repayment for Russian gas
MOSCOW, May 30. /ITAR-TASS/. Three-party gas talks within the Russia-Ukraine-EU format have coincided with the deadline for repayment by Ukraine’s Naftogaz of $2 billion of debt for the supplied Russian gas.
The deadline was set at the latest tripartite meeting in Berlin on May 26 when a compromise had been reached to settle Ukraine’s debt for Russian gas. The deadline expired on Friday, May 30.
From June 1 Ukraine’s debt will exceed $5 billion.
It is supposed that before the end of the week Naftogaz will transfer $2 billion to Russia’s Gazprom, thereby partially repaying the debt for the already supplied gas and, not later than on June 7, remit another $500 million as an advance payment for June deliveries.
Earlier Gazprom had insisted Naftogaz pay off the debt on the amount of almost $2.3 billion.
If Ukraine violates the payment scheme, approved at the latest Berlin meeting, Gazprom will stop gas supplies to Ukraine from June 3.
In case of an unsanctioned off-take of gas by Ukraine, Russia intends to introduce “an early warning” mechanism for creating a group of specialists who will monitor and record the amounts of gas supplies to Ukraine.
Naftogaz of Ukraine has money to pay debts (about $2 billion) after the company augmented its capital by issuing additional shares with the state ownership of 100% of shares preserved.
At the Berlin talks, Russia will be represented by Energy Minister Alexander Novak. Ukraine’s delegation will be led by acting Minister of Energy and Coal Industry Yuriy Prodan. European Commissioner for Energy Guenther Oettinger will represent the EU.
WASHINGTON, May 30. /ITAR-TASS/. The US has been interfering with the France-Russia deal on the Mistral helicopter carrier: a group of democratic members of the Congress has sent a letter to NATO’s secretary general urging to persuade Paris to refuse from the deal with Moscow and to sell the warships to NATO. The initiative was supposed to become a “strong signal” to Russia concerning Ukraine.
The US has been making several attempts to scuttle the contract, where the French authorities confirm the obligations are observed properly. France’s Foreign Minister Laurent Fabius said during his visit to Washington in May, Russia had paid over half the contract price and thus no legal grounds existed for saying “no.”
However, the Mistral story is not over. Paris claimed a “final decision” was due in October after a legal analysis of the deal. That would refer to the economic sanctions against Russia as the Mistral contract is on the list of the third sanctions against the Russian Federation.
If the contract is terminated, France will owe over €1.2 billion to Russia. The amount covers the deal for two ships and fines for France’s termination of the contract. Russia’s Deputy Prime Minister Dmitry Rogozin forecasts the wave around the situation in Ukraine would fade away and currently European politicians should think about consequences for interests of their own countries.
The contract worth €1.12 billion on construction of the helicopter carriers for Russia’s Navy is dated 2011. Under the contract, France is to build at the STX shipyard in Saint-Nazaire. The first ship is due to be ready in October, and the other one - in 2016.
Russia’s defense products exporting authority (Rosoboronexport) hopes the French side would not change the contract. A breach of legally binding conditions will cause a response, the authority’s representative told ITAR-TASS.
Military op to continue in E. Ukraine until 'stability' restored - defense minister
Published time: May 30, 2014 07:50 Edited time: May 30, 2014 09:56
Kiev government has launched a massive military offensive in the east of Ukraine which claimed dozens of lives, both among the militias and local civilians. Schools, kindergarten and hospitals in several cities came under fire.
"We will work until the region begins live and function normally and people will get peace,” said acting Defense Minister Mikhail Koval during a briefing.
A Ukrainian soldier (AFP Photo / Genya Savilov)
He added that the south and west of Donetsk Region and the north of Lugansk region have been‘freed’ during the military operations in the Ukrainian east.
Koval said that more than 20 Ukrainian soldiers have been killed during the Kiev crackdown in eastern Ukraine.
Meanwhile, according to officials from the People’s Republic of Donetsk, over 100 people have been killed during the offensives.
An RT report showed more horror suffered by innocent civilians from Ukraine’s eastern region of Donetsk, who were shelled in Kiev’s so-called “anti-terrorist” operation.
Hospitals, schools under Kiev fire
Kiev troops have intensified military operations on eastern Ukraine since April. They are using artillery and aviation in a bid to take control of the restive region.
On Friday, Kiev forces renewed the shelling on Slavyansk, in the Donetsk region, residents there told RT. The militia targeted a local children's hospital and a clinic.
Детская больница после утреннего обстрела. 30.05.2014 #Славянск
On Wednesday, a school and kindergarten in Slavyansk were also hit by mortar shells. According to a schoolteacher interviewed by RT, part of the roof over the school hall “was simply blown away.” Luckily, no children were in the hall when they heard a loud explosion, and those present were quickly evacuated to the basement. Meanwhile, in the kindergarten at least 9 civilians were injured, including a 4-year old boy, reported the Rossiya-24 channel.
UN High Commissioner for Human Rights Navi Pillay said on Wednesday that Kiev should refrain from using excessive force in Ukraine.
“I call on the Ukrainian authorities to ensure that no excessive force is used, not to take discriminatory action and to avoid action that can harm the civilian population,” the official told Itar-Tass.
UK slams Brussels seeking taxpayer cash for Kiev & jobless
Britain has slammed Brussels for demanding an extra £500 million ($835.30 million) as the EU seeks to collect another 4.7 billion euro from member states to help crisis-hit Ukraine and to cover youth unemployment projects.
While the UK “agreed that extra support be given to Ukraine and youth employment initiatives”, London “firmly believes” the European Commission should “reallocate existing funds within the agreed budget” instead of asking for more money.
"At a time when countries across Europe continue to take difficult decisions to deal with deficits, the European Commission should not be asking Europe's taxpayers for yet more money," a spokeswoman for Britain's Treasury, said in a statement.
"Member states agreed to frontload youth employment and science from 2015 to 2014, which means more resources are needed", the European Commission (EC) said on Wednesday.
The EC also said it needed more money to help Ukraine and under the so-called "contingency margin", the EU Commission can ask for extra funding to be spent for unforeseen circumstances.
In the case of Britain, one of the largest contributors to the union, its share of the extra 4.7 billion euro needed would equal about £500 million (600 million euro). Up to 75 million euro would go to help Ukraine.
Britain's EU bill has more than tripled over the last decade, bringing the cost from £2.9 billion in 2002 to £9.5 billion in 2012.
Prime Minister David Cameron has vowed to tackle the problem as part of his plan to reconsider Britain-EU relations if re-elected, staging an in-out EU referendum before 2017.
Britain Prime minister David Cameron (AFP Photo / Georges Gobet)
The EU’s demand has angered other member states as it comes shortly after last week’s European elections, in which millions in Britain, France, Denmark and Greece voted for populist and far-Left and Right parties, opposing closer ties with the EU or the bloc concept itself.
"What a smart way to react to the concerns of Europe's voters, let's ask them for more money," a European diplomat told the Telegraph. "The commission must live on another planet if they think that Europe can reconnect with people by raiding their wallets."
Last year, the EU approved a seven-year budget plan that foresees a maximum spend of 908 billion euro between 2014 and 2020.
KIEV, May 30 (RIA Novosti) – Ukrainian forces are planning to continue the Kiev regime’s special operation in the country's southeast until they reach a complete stabilization in the region, Ukraine's interim Defense Minister Mykhailo Koval said Friday.
“We will work until this region begins to live normally… and until the people [begin] to live in peace,” Koval said.
The Ukrainian army has freed the southern and western parts of the Donetsk region, as well as the north of the region of Luhansk during the operation, the minister said.
One of the main goals of the Ukrainian military is re-establishing the regular functioning of the Kiev interim authorities on the freed territory, he added.
Media reports earlier emerged that Ukraine’s security forces planned to complete the operation against federalists in the country’s east by June 14.
The Ukrainian security operation in southeastern Ukraine is continuing despite a memorandum on peace and accord adopted by the parliament ahead of the May 25 presidential vote. The operation has killed scores of people on both sides.
Russian Foreign Minister Sergei Lavrov said earlier that Ukraine must immediately move to stop violence and launch nationwide dialogue following a presidential vote in the country.
The self-proclaimed Donetsk and Luhansk people’s republics in eastern Ukraine held referendums on self-determination on May 11, with over 90 percent of voters supporting greater autonomy.
MOSCOW, May 30 (RIA Novosti) – The Russian Federal Security Service (FSB) has detained a group of Ukrainian radicals from the far-right Right Sector movement implicated in attempted terrorist attacks in Crimea’s Simferopol, Yalta and Sevastopol, the agency said Friday.
“The investigation department of Russia’s FSB has opened a criminal probe against [members of Right Sector] … who have prepared as part of a terrorist organization for the perpetration of a terrorist attack and explosions on the night of May 8 … in Simferopol [in Crimea],” the FSB press office said.
Searches of the homes of the detained extremists' accomplices yielded explosives, firearms, ammunition, and gas masks, according to the Vzglyad newspaper. The FSB said the four admitted the plot was aimed at destabilizing the political situation on the peninsula ahead of the independence referendum.
Crimea, previously an autonomous republic within Ukraine, refused to recognize the legitimacy of the coup-imposed government in Kiev that came to power following the February overthrow of President Yanukovych and voted to secede. On March 16, Crimea held a referendum which saw over 96 percent of voters in the region back the motion to leave Ukraine for Russia.
In March, an unknown sniper opened fire at people in Crimea’s capital Simferopol in an incident that republic’s Prime Minister Sergei Aksyonov said was aimed at fanning fear in the region.
Russian-led rebels dig in for Ukraine attack
Vostok Battalion takes over Donetsk government HQ, removing rebel administration and preparing defences against attack.
Donetsk, Ukraine - Russian-led paramilitaries are fortifying Donetsk’s provincial government building after kicking out separatist administrators, signalling a shift in power as rebels prepare for an expected assault by Ukrainian troops.
The Russian-dominated Vostok Battalion was securing the building on Friday, a day after it removed local separatist fighters and accused them of looting shops while they engaged Ukrainian forces at the city’s international airport earlier this week.
Vostok soldiers set up defences outside of the building, including an anti-aircraft gun, and bulldozed barricades to create a "free-fire zone" to prepare for an expected attack by Ukrainian soldiers.
The preparations are being made as civilians begin to leave the city, with the rail station packed as rumours circulate of an impending Ukrainian attack on separatist positions.
The president-elect of Ukraine, Petro Poroshenko, promised on Thursday to "punish" the rebels in the east of the country following the downing of a Ukraine helicopter in Slovyansk that killed 14 soldiers, including a general. Poroshenko described the rebels as "terrorists" and "bandits".
The Ukrainian authorities said the helicopter was shot down by a sophisticated surface-to-are missile supplied by Russia.
More than 35 separatist fighters were killed in the battle for the airport, as Ukrainian forces launched helicopter attacks and sent paratroopers to regain control of the airport.
Since then, separatists have brought more fighters and supplies into the city, with a huge convoy driving through the centre of the city on Thursday. Many are believed to have come from Russia.
Al Jazeera witnessed the takeover of the provincial government building on the same day.
Vostok fighters arrested about a dozen separatists inside, whom they accused of looting, and kicked out the rest of the "administration" - mostly poorly clothed, poorly armed and poorly informed locals.
The actions of the Vostok Battalion, under the command of Alexander Khodkovsky, the head of the Donetsk People’s Republic’s security service, appeared to have been part of an internal "coup" under the pretence of restoring order.
Separatists shore up defences
The takeover also allows the Vostok Battalion to secure important sites, manning them with seasoned, well-armed and trained men to prepare for any attack by the Ukrainian army.
On the eighth floor of the building, a Vostok soldier who called himself Sergey broke through a door locked by the previous occupants to find piles of looted goods, including cartons of cigarettes, toothpaste, cheap Chinese-made toys and even kilos of butter.
"While we were fighting at the airport, these guys were looting the Metro supermarket nearby," Sergey said.
"This is not what the Donetsk People’s Republic is about. This is a bad joke."