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Vladimir Putin Ignores Ukraine Warnings From Obama

Vladimir Putin Ignores Ukraine Warnings From Obama.

WASHINGTON – One by one, President Barack Obama’s warnings to Russia are being brushed aside by President Vladimir Putin, who appears to only be speeding up efforts to formally stake his claim to Ukraine’s Crimean Peninsula.

In the week since Obama first declared there would be “costs” if Putin pressed into Crimea, Russian forces have taken control of the region and a referendum has been scheduled to decide its future. Obama declared the March 16 vote a violation of international law, but in a region where ethnic Russians are the majority, the referendum seems likely to become another barrier to White House efforts to compel Putin to pull his forces from Crimea.

“The referendum vote is going to serve for Putin, in his mind, as the credibility and legitimacy of Russia’s presence there,” said Andrew Kuchins, the director of the Russia program at the Center for Strategic and International Studies.

If Crimea votes to join Russia, the referendum could also put Obama in the awkward position of opposing the outcome of a popular vote.

The White House has tried to match Russia’s assertive posture by moving quickly to impose financial sanctions and travel bans on Russians and other opponents of Ukraine’s new central government. U.S. officials have also urgently tried to rally the international community around the notion that Russia’s military maneuvers in Crimea are illegal, even seeking support from China, Moscow’s frequent ally against the West.

“I am confident that we are moving forward together, united in our determination to oppose actions that violate international law and to support the government and people of Ukraine,” Obama said Thursday.

The European Union also announced Thursday that it was suspending talks with Putin’s government on a wide-ranging economic agreement and on granting Russian citizens visa-free travel within the 28-nation bloc — a long-standing Russian objective.

The White House says it still believes a diplomatic solution to the dispute with Russia is possible. Obama spoke with Putin for more than an hour Thursday, outlining a potential resolution that would include Russia pulling its forces back in Crimea and direct talks between the Kremlin and Ukraine.

But the fast-moving developments in Crimea may mean that the ultimate question facing Obama is not be what the U.S. can do to stop Russia from taking control of Crimea, but what kind of relationship Washington can have with Moscow should that occur.

White House advisers insist the U.S. could not go back to a business as usual approach with Russia if Moscow were to annex Crimea or recognize its independence. But that may be seen as empty threat to the Kremlin after the U.S., as well as Europe, did just that in 2008 after Russia recognized the independence of Abkhazia and South Ossetia, two breakaway territories of Georgia. Russia also continues to keep military forces in both territories.

Privately, U.S. officials say Russia is running a similar playbook as it seeks to increase its influence in Crimea. And regional experts say Putin also appears to have a larger goal: influencing central government lawmakers in the Ukrainian capital of Kyiv as they prepare for elections later this spring.

“It says to the Ukrainians, Don’t mess with me or I’ll slice off a finger,” said Matthew Rojansky, a Russia analyst at the Woodrow Wilson International Center for Scholars.

The months-long political crisis in Ukraine bubbled over late last month when protesters in Kyiv ousted pro-Russian President Viktor Yanukovych. Amid the chaos, thousands of Russian forces took control of Crimea, a strategically important outpost in the Black Sea where Moscow has a military base.

The outcome of the Crimea referendum is not guaranteed, but there are clear indications the region will choose to side with Russia. About 60 per cent of Crimea’s population already identifies itself as Russian. And Crimea’s 100-seat parliament voted unanimously Thursday in favour of joining Russia.

The referendum had been scheduled for March 30, but was pushed up two weeks. And while the original vote was only on whether Crimea should get enhanced local powers, the peninsula’s residents will now also vote on whether to join Russia.

U.S. officials say they believe Putin was involved in orchestrating the referendum, though the Russian leader made no public statements about the planned vote. Earlier in the week, Putin said Russia had no intention of annexing Crimea, while insisting its population has the right to determine the region’s status in a referendum.

U.S. officials say they also see an unlikely ally emerging in China, which has frequently sided with Russia at the United Nations Security Council in blocking Western actions. While China has not condemned Russia’s actions outright, Beijing’s ambassador to the U.N. this week said it supported “noninterference” and respects Ukraine’s sovereignty and territorial integrity.

Susan Rice, Obama’s national security adviser, spoke this week with Chinese State Councilor Yang Jiechi. The White House said the officials agreed on the need for a peaceful resolution to the dispute that “upholds Ukraine’s sovereignty and territorial integrity.”

It appears unlikely China would actually take punitive actions against Russia. U.S. officials say Beijing is largely acting out of self-interest and appears to view the developments in Crimea through the prism of a nation that also has ethnic minorities who live in border regions and identify more closely with neighbouring countries.

Viktor Yanukovych Arrest Warrant Issued, As Ukraine Authorities Hunt President In Crimea

Viktor Yanukovych Arrest Warrant Issued, As Ukraine Authorities Hunt President In Crimea.

CP  |  By Yuras Karmanau And Maria Danilova, The Associated PressPosted: 02/24/2014 3:46 am EST  |  Updated: 02/24/2014 8:59 am EST

Viktor Yanukovych

SIMFEROPOL, Ukraine – Ukraine’s acting government issued a warrant Monday for the arrest of President Viktor Yanukovych, last seen in the pro-Russian Black Sea peninsula of Crimea, accusing him of mass crimes against protesters who stood up for months against his rule.

Calls are mounting in Ukraine to put Yanukovych on trial, after a tumultuous presidency in which he amassed powers, enriched his allies and cracked down on protesters. Anger boiled over last week after snipers attacked protesters in the bloodiest violence in Ukraine’s post-Soviet history.

The turmoil has turned this strategically located country of 46 million inside out over the past few days, raising fears that it could split apart. The parliament speaker is suddenly nominally in charge of a country whose economy is on the brink of default and whose loyalties are torn between Europe and longtime ruler Russia.

Ukraine’s acting interior minister, Arsen Avakhov, said on his official Facebook page Monday that a warrant has been issued for the arrest of Yanukovych and several other officials for the “mass killing of civilians.” At least 82 people, primarily protesters, were killed in clashes in Kyiv last week.

Avakhov says Yanukovych arrived in Crimea on Sunday and relinquished his official security detail then drove off to an unknown location.

After signing an agreement with the opposition to end a conflict that turned deadly, Yanukovych fled the capital for eastern Ukraine. Avakhov said he tried to fly out of Donetsk but was stopped, then went to Crimea.

Tensions have been mounting in Crimea, where pro-Russian protesters raised a Russian flag on a city hall in one town and scuffled with police. Russia maintains a big naval base in the Crimean port of Sevastopol that has tangled relations between the countries for two decades.

Yanukovych set off a wave of protests by shelving an agreement with the EU in November and turning toward Russia, and the movement quickly expanded its grievances to corruption, human rights abuses and calls for Yanukovych’s resignation.

“We must find Yanukovych and put him on trial,” said protester Leonid Shovtak, a 50-year-old farmer from the western Ivano-Frankivsk region who came to Kyiv’s Independence Square to take part in the three-month protest movement. “All the criminals with him should be in prison.”

The speaker of parliament assumed the president’s powers Sunday, even though a presidential aide told the AP on Sunday that Yanukovych plans to stay in power.

The speaker, Oleksandr Turchinov, said top priorities include saving the economy and “returning to the path of European integration,” according to news agencies. The latter phrase is certain to displease Moscow, which wants Ukraine to be part of a customs union that would rival the EU and bolster Russia’s influence. Russia granted Ukraine a $15 billion bailout after Yanukovych backed away from the EU deal.

U.S. Ambassador Geoffrey Pyatt said the U.S. is ready to help Ukraine get aid from the International Monetary Fund.

The European Union, meanwhile, is reviving efforts to strike a deal with Ukraine that could involve billions of euros in economic perks. EU foreign policy chief Catherine Ashton is visiting Kyiv on Monday and Tuesday.

The protest movement has been in large part a fight for the country’s economic future — for better jobs and prosperity.

Ukraine has struggled with corruption, bad government and short-sighted reliance on cheap gas from Russia. Political unrest has pushed up the deficit and sent exchange rates bouncing, and may have pushed the economy back into a recession.

Per capita economic output is only around $7,300, even adjusted for the lower cost of living there, compared to $22,200 in Poland and around $51,700 in the United States. Ukraine ranks 137th worldwide, behind El Salvador, Namibia, and Guyana.

Ukraine has a large potential consumer market, with 46 million people, an educated workforce, and a rich potential export market next door in the EU. It has a significant industrial base and good natural resources, in particular rich farmland.

Viktor Yanukovych Arrest Warrant Issued, As Ukraine Authorities Hunt President In Crimea

Viktor Yanukovych Arrest Warrant Issued, As Ukraine Authorities Hunt President In Crimea.

CP  |  By Yuras Karmanau And Maria Danilova, The Associated PressPosted: 02/24/2014 3:46 am EST  |  Updated: 02/24/2014 6:59 am EST

Viktor Yanukovych

SIMFEROPOL, Ukraine – Ukraine’s acting government issued a warrant Monday for the arrest of President Viktor Yanukovych, last seen in the pro-Russian Black Sea peninsula of Crimea, accusing him of mass crimes against protesters who stood up for months against his rule.

Calls are mounting in Ukraine to put Yanukovych on trial, after a tumultuous presidency in which he amassed powers, enriched his allies and cracked down on protesters. Anger boiled over last week after snipers attacked protesters in the bloodiest violence in Ukraine’s post-Soviet history.

The turmoil has turned this strategically located country of 46 million inside out over the past few days, raising fears that it could split apart. The parliament speaker is suddenly nominally in charge of a country whose economy is on the brink of default and whose loyalties are torn between Europe and longtime ruler Russia.

Ukraine’s acting interior minister, Arsen Avakhov, said on his official Facebook page Monday that a warrant has been issued for the arrest of Yanukovych and several other officials for the “mass killing of civilians.” At least 82 people, primarily protesters, were killed in clashes in Kyiv last week.

Avakhov says Yanukovych arrived in Crimea on Sunday and relinquished his official security detail then drove off to an unknown location.

After signing an agreement with the opposition to end a conflict that turned deadly, Yanukovych fled the capital for eastern Ukraine. Avakhov said he tried to fly out of Donetsk but was stopped, then went to Crimea.

Tensions have been mounting in Crimea, where pro-Russian protesters raised a Russian flag on a city hall in one town and scuffled with police. Russia maintains a big naval base in the Crimean port of Sevastopol that has tangled relations between the countries for two decades.

Yanukovych set off a wave of protests by shelving an agreement with the EU in November and turning toward Russia, and the movement quickly expanded its grievances to corruption, human rights abuses and calls for Yanukovych’s resignation.

“We must find Yanukovych and put him on trial,” said protester Leonid Shovtak, a 50-year-old farmer from the western Ivano-Frankivsk region who came to Kyiv’s Independence Square to take part in the three-month protest movement. “All the criminals with him should be in prison.”

The speaker of parliament assumed the president’s powers Sunday, even though a presidential aide told the AP on Sunday that Yanukovych plans to stay in power.

The speaker, Oleksandr Turchinov, said top priorities include saving the economy and “returning to the path of European integration,” according to news agencies. The latter phrase is certain to displease Moscow, which wants Ukraine to be part of a customs union that would rival the EU and bolster Russia’s influence. Russia granted Ukraine a $15 billion bailout after Yanukovych backed away from the EU deal.

U.S. Ambassador Geoffrey Pyatt said the U.S. is ready to help Ukraine get aid from the International Monetary Fund.

The European Union, meanwhile, is reviving efforts to strike a deal with Ukraine that could involve billions of euros in economic perks. EU foreign policy chief Catherine Ashton is visiting Kyiv on Monday and Tuesday.

The protest movement has been in large part a fight for the country’s economic future — for better jobs and prosperity.

Ukraine has struggled with corruption, bad government and short-sighted reliance on cheap gas from Russia. Political unrest has pushed up the deficit and sent exchange rates bouncing, and may have pushed the economy back into a recession.

Per capita economic output is only around $7,300, even adjusted for the lower cost of living there, compared to $22,200 in Poland and around $51,700 in the United States. Ukraine ranks 137th worldwide, behind El Salvador, Namibia, and Guyana.

Ukraine has a large potential consumer market, with 46 million people, an educated workforce, and a rich potential export market next door in the EU. It has a significant industrial base and good natural resources, in particular rich farmland.

UK Tells Russia: Don’t Intervene In Ukraine

UK Tells Russia: Don’t Intervene In Ukraine.

Posted: 02/23/2014 6:09 am EST Updated: 02/23/2014 9:59 am EST


Main Entry Image


By Andrew Osborn

LONDON, Feb 23 (Reuters) – Britain warned Russia on Sunday against intervening in Ukraine’s “complex” crisis, saying London wanted to contribute to an international economic programme aimed at shoring up the “desperately difficult” situation of the Ukrainian economy.

In comments that may anger Moscow, British Foreign Secretary William Hague said his government was in regular contact with the Russian government to try to persuade it that closer ties between Ukraine and the European Union should not worry it.

“If there’s an economic package, it will be important that Russia doesn’t do anything to undermine that economic package and is working in cooperation and support of it,” Hague told BBC TV.

When asked if he was worried that Russia might “send in the tanks” to defend the interests of Russian-speakers in eastern Ukraine, Hague warned against what he called “external duress” or Russian intervention.

“It would really not be in the interests of Russia to do any such thing. We have to keep up the communication with Russia as we are doing … so that the people of Ukraine can choose their own way forward. There are many dangers and uncertainties.”

Ukraine’s parliament voted to remove President Viktor Yanukovich on Saturday after three months of street protests, while his arch-rival Yulia Tymoshenko hailed opposition demonstrators as “heroes” in an emotional speech in Kiev after she was released from jail.

The crisis began as protests against Yanukovich’s decision to abandon a trade agreement with the European Union in favour of closer ties with Russia, which promised to lend Ukraine $15 billion euros. Ukraine needs the money — foreign investment inflows fell by almost half last year, to a net $2.86 billion from $4.13 billion in 2012 

Britain has so far assumed a lower profile on Ukraine than countries such as Germany and Poland, though Prime Minister David Cameron spoke to Russian President Vladimir Putin last Thursday about the situation there and Hague said he’d be talking to Russian Foreign Minister Sergei Lavrov on Monday.

Hague said the priority was to persuade Moscow that the fate of Ukraine – a country that was part of the Soviet Union and has been within Russia’s sphere of influence for decades – was not what he called “a zero-sum game” and that closer ties with the EU were not a bad thing.

“It’s in the interests of the people of Ukraine to be able to trade more freely with the EU. It’s the interests of the people of Russia for that to happen as well.”

He said he didn’t know what Russia’s “next reaction” would be, but he pushed the Ukrainian opposition to move urgently to form a government of national unity, agree arrangements for new elections, and to crack on with shoring up the economy.

“While all this has been happening, the Ukrainian economy is in a desperately difficult situation,” Hague said. “And they need an economic programme that the rest of us, through the International Monetary Fund and other institutions, can support so that they can stave of an even more serious economic situation.”

Ukraine police dismantle protest camps – Europe – Al Jazeera English

Ukraine police dismantle protest camps – Europe – Al Jazeera English.

At least three protesters have been killed in clashes as Ukraine’s prime minister takes a hard line against demonstrators flouting anti-protest laws.

Mykola Azarov said on Wednesday that anti-government protests had brought “terrorists” onto the streets of Kiev and pledged to punish all “criminal action”, even as protesters confronted police near government headquarters.

“I am officially stating that these are criminals who must answer for their action,” Azarov said.

Wednesday’s violence came after Ukrainian security forces started dismantling barricades at the protest camp in downtown Kiev, where demonstrators and police have been facing off for the past two nights.

It is reported that two of the victims died from gunshot wounds and were found less than three hours apart in a national library close to the clashes.

The third died in a fall from the top of Dynamo football stadium.

Azarov said opposition leaders should be held responsible for the deaths and said that police at the site of the clashes did not have live ammunition.

The wounds resembled those caused by live ammunition, Oleh Musiy, coordinator of the protesters’ medical corps, told the AP news agency.

EU foreign policy chief Catherine Ashton on Wednesday urged “an immediate end” to the escalating violence, while the Polish Foreign Ministry has summoned the Ukrainian ambassador.

Al Jazeera’s Nadim Baba, reporting from Kiev, said some protesters had become more determined as a consequence of Wednesday’s events.

“It’s not clear how news of the deaths will change the nature of these protests, but for now people are continuing to arrive here at the scene of the clashes,” our correspondent said.

New laws

The violence began when protesters braved heavy snow to remain in Kiev’s central square on Wednesday morning, despite warnings from Azarov that security personnel could use force to disperse demonstrations.

Azarov told Russian television that if “provocateurs” did not stop, the authorities could act under controversial new laws that essentially ban large protests in Ukraine.

Azarov added that he hoped there would be no need for the use of force to disperse the protests.

“We are hoping for common sense,” he said. “People need to understand that they are being offered chaos and destruction.”

On Tuesday, President Viktor Yanukovych refused to meet with an opposition leader, dimming hopes of a peaceful solution to the political crisis.

Russian Foreign Minister Sergei Lavrov warned that the situation in Ukraine was spiralling out of control after two months of protests over Yanukovych’s failure to sign a deal with the European Union.

The UN’s High Commissioner for Human Rights, Navi Pillay, has called the situation in Ukraine “very worrying” and said the government should suspend the controversial anti-protest laws.

Violence as Ukraine anti-protest law enacted – Europe – Al Jazeera English

Violence as Ukraine anti-protest law enacted – Europe – Al Jazeera English.

A controversial anti-protest law has come into effect in Ukraine, despite violent rallies against the legislation that have taken place for the past two days, ignoring an appeal for calm by President Viktor Yanukovych.

The new law, which bans all forms of protests, was published in the official Golos Ukrainy, or Voice of Ukraine, newspaper, raising fears that the government would use excessive force to quell dissent.

Opposition and and the West have condemned the bill, demanding that it be reversed, but the interior ministry said at least 32 protesters had been arrested in the most recent round of demonstrations.

Yanukovych made a call for calm on Monday, when demonstrators braved sub-zero temperatures and clashed with police over new anti-protest laws.

A statement issued on the presidential website said: “When peaceful actions have escalated into mass riots accompanied by demolition, arson and violence, I am confident that such phenomena threaten not only Kiev but the whole of the Ukraine. I call for dialogue, compromise and peace in our native land.”

The situation was tense in Kiev, with protesters occasionally charging against police lines guarding the passage to government buildings, throwing stones and Molotov cocktails.

The violence, which began on Sunday, came after Yanukovych pushed through an anti-protest law that significantly increased fines and imposed jail terms for unauthorised street protests.

The new law also prohibits activists from wearing helmets or masks to demonstrations, curbs free speech and limits the ability to investigate or monitor the activity of officials, including judges.

Sunday’s fighting left about 200 people wounded.

Reconciliation talks

In an attempt to find a compromise, opposition leader and former boxer Vitali Klitschko travelled to Yanukovych’s home outside Kiev to meet him.

The president received Klitschko and promised on Monday to create a special commission of officials set up by national security council secretary Andriy Klyuyev to solve the crisis. The move was announced by Klitscko’s party, the Ukrainian Democratic Alliance for Reform, and the presidency.

The presidency said the new commission would meet the opposition but there was no sign that the meeting had taken place as of Monday evening.

Meanwhile, European Union foreign ministers meeting in Brussels deplored the continued violence, saying the government was at fault for adopting the repressive laws.

The White House urged an end to the fighting, with US National Security Council spokeswoman Caitlin Hayden saying that Washington was deeply concerned and urged “all sides to immediately de-escalate the situation”.

“The US will continue to consider additional steps – including sanctions – in response to the use of violence,” Hayden added.

Ukraine protesters clash with riot police – Europe – Al Jazeera English

Ukraine protesters clash with riot police – Europe – Al Jazeera English.

Thousands of anti-government demonstrators have clashed for hours with riot police in Ukraine’s capital, attacking officers with sticks, stones and flares after new laws were passed to stifle protests.

The riots, some of the most violent Kiev has seen in recent times, were continuing well into the early hours of Monday morning.

They have further raised the stakes in the almost two-month standoff between the opposition and President Viktor Yanukovych which has seen protesters seize control of the main city square in Kiev

Health officials said 24 people were injured and three were hospitalised, while police said more than 70 officers had been hurt. The interior ministry said 10 people had already been arrested for mass rioting.

The protesters, many wearing hard hats and gas masks in defiance of new legislation banning them from covering their faces, also used stun grenades and fire extinguishers on officers at Sunday’s rally in Kiev. Several police buses and cars were also torched.

Police responded by using tear-gas and stun grenades of their own. Water cannons were also fired at the protesters in temperatures of -8C, but the clashes continued.

Despite appeals from opposition leaders not to resort to violence, and a personal intervention from Vitaly Klitschko, a Ukrainian boxer turned politician, protesters continued to throw smoke bombs and hurl fireworks and other objects at police.

Against this backdrop, Yanukovych met Klitschko at the former’s Mezhygirya residence and the pair pledged to create a cross-party commission to resolve the ongoing crisis.

“The president pledged to create on Monday morning a commission with representatives from the presidential administration, cabinet and opposition to find a solution to the crisis situation,” Klitschko’s party quoted him as saying.

The protests, initially prompted by Yanukovych’s decision to reject a trade deal with the European Union and instead opted for closer ties with Russia. They intensified following police violence.

International condemnation

Up to 100,000 people had massed in defiance of sweeping new laws aimed at stamping out anti-government demonstrations.

Al Jazeera’s Jennifer Glasse, reporting from Kiev on Sunday, said the clashes underscored the divide among the protesters.

“The protests, which has been going on for the past eight weeks, have largely been peaceful and well-organised, but some of the protesters feel frustrated and they want to take the protests on to the streets and confront authorities on the streets of Kiev,” she said.

Last week Yanukovych caused uproar at home and abroad when he approved a number of laws that limit Ukrainians’ rights to protest, civic activism and free speech.

Other provisions ban the dissemination of “slander” on the internet and introduce the term “foreign agent” to be applied to NGOs that receive foreign funding.

Putin’s Deal Is No Gift to Gas-Junkie Ukraine – Bloomberg

Putin’s Deal Is No Gift to Gas-Junkie Ukraine – Bloomberg.

Amazingly, tens of thousands of Ukrainians are still braving the winter cold to protest what they consider to be the sale of their country’s future to Russia.

A big part of the deal in dispute was what Russian President Vladimir Putin described as a “fraternal” 33 percent discount on the price that Ukraine pays for natural gas imports. So why aren’t Ukrainians more grateful to their bigger brother? Maybe they have done the math — which shows it really isn’t such a bargain after all.

There are two major elements to the agreement: a $15 billion loan pledge and a reduction in the price of natural gas imports from about $400 per 1,000 cubic meters (tcm) to $268.50. The average price that Gazprom charges to European Union countries for long-term contracts is $370 to $380. So it sounds as though Ukraine will now get a big discount — plus a generous bailout. Not quite.

The gas has to cross Ukraine to get to EU markets, and the $370-$380 that Gazprom charges countries such as Germany includes the cost of that transit. Ukraine charges about $3 per 1000 cubic meters per 100 kilometers. The distance from the Ukrainian border with Russia to the big European hub at Baumgarten, Austria, is about 1800 kilometers. So subtract about $50 from the European gas price to get closer to a true equivalent. Then consider that the EU now has a hub, or spot market price for gas that’s often lower than Gazprom’s. “What I find interesting is that $268.50 isn’t so far off the European hub price, once you deduct transit costs,” says Simon Pirani, a senior research fellow at the Oxford Institute for Energy Studies, who specializes on the gas trade in the ex-Soviet Union.

When Ukraine struck its gas contract price with Russia in 2009, it was under threat of another cutoff of its gas supply, as had occurred in 2009, 2008 and 2006. The thinking behind the new price was that Ukraine should start paying the European price for gas, in exchange for independence. Think of Ukraine as a natural gas junkie, addicted to cheap Russian fuel. Before 2006, this relatively poor country — which has a population of 46 million and an economy 19 times smaller than Germany’s — had been consuming almost 80 billion cubic meters of gas annually. Germany was consuming just under 100 bcm. Ukraine had been paying just $50 per 100 cubic meters for Russian gas imports. So something had to change.

The formula reached in 2009 was index-linked to the price of oil. Three things then happened: The price of oil rose; the EU started to link up its natural gas grids to create a spot market at the gas hubs, independent of Gazprom’s long-term contracts; and demand for gas within the EU fell. Indeed, without a renegotiation in 2010 (Russia got extended naval basing rights in exchange), Ukraine would now be paying $500 per 100 cubic meters of gas.

The reduced price Ukraine pays to Gazprom is still so out of kilter that it is about $30 cheaper to buy gas the EU has imported and transport it back across the border. This re-importing had started to happen on a very small scale from Poland and Hungary. And on Dec. 9, Slovakia’s gas transit company Eustream agreed on terms to reverse the flow in one of its big transit pipes.

With the necessary Slovak capacity, Ukraine might have been able to fulfill the deal it has to buy 10 bcm of gas annually from Germany’s RWE AG. That would represent about a third of Ukraine’s current imports from Russia, which had already fallen substantially because of Ukraine’s declining gas consumption, due to a collapsing economy, coal substitution and efficiency improvements, according to Pirani.

Faced by competition from EU re-suppliers, Gazprom would in any case have had to choose: risk losing as much as another one third of its gas sales to Ukraine and associated political leverage, or else reduce its price by a third to make EU re-imports uncompetitive.

In sum, it’s clear that the $268.50 discount offered to Yanukovych wasn’t as generous as it sounds. Putin in essence agreed to stop extorting money from Ukraine and charge the market price.

So how about the $15 billion loan? Russia bought the first $3 billion of Ukrainian eurobonds as promised just before Christmas, at a coupon rate of 5 percent. Ukraine had an alternative source for a $15 billion bailout loan, from the International Monetary Fund. The interest rate payable to the IMF probably would have been cheaper by 2 percentage points or more.

The difference between the two loans is, again, best looked at in terms of an addict and supplier. The IMF was offering rehab, a painful treatment that would have involved: devaluing the currency; reducing energy subsidies worth about 7.5 percent of gross domestic product; making other budget cuts in areas such as pensions, which account for as much as 18 percent of GDP; and structural reforms.

Russia’s loan was free of known strings, except those that bind a hopeless debtor to his creditor. What the Russian money does better is fund Yanukovych’s 2015 election campaign. Prime Minister Mykola Azarov immediately started announcing how the money will be spent, including increases to the minimum wage, child benefits and public sector pay raises — everything the IMF would oppose.

The IMF loan terms would have been better for Ukraine. The Putin deal is better for Yanukovych. No wonder some Ukrainians plan to take to the streets again to call for his resignation on New Year’s Day, even if their cause appears to be lost.

 

European countries reel from deadly storms – Europe – Al Jazeera English

European countries reel from deadly storms – Europe – Al Jazeera English.

Deadly hurricane-force winds and torrential rain have brought havoc to transport networks Britain and France.The death toll rose to at least six people on Tuesday, as winds of up to 145kph hit both sides of the Channel with heavy downpours causing flooding, traffic jams, and cancellations of rail, flight and ferry services.

Aidan McGivern, a meteorologist, told Al Jazeera people were preparing themselves for more bad weather.

Analysts expect the storms to hurt retailers eager to cash in on the traditional Christmas rush [EPA]

In Britain, the number of people killed in two days of storms rose to at least five after a man died trying to rescue his dog from fast-flowing waters in Devon, southwest England.

A teenager died in France on Monday after a wall collapsed on him.

Airports in southern England were disrupted, with some flights from Britain’s busiest airport, Heathrow, cancelled or delayed.

Britain’s second busiest airport, Gatwick, said one terminal had been hit by a major power outage on Tuesday and storm damage had temporarily cut all trains to the airport.

Several hundred passengers were stranded at the airport and airport police had to be called in to help deal with angry passengers.

British train operators cancelled hundreds of services on Tuesday morning, by which time the storm had abated, leaving hundreds of thousands of people scrambling to get on to later services in and out of London.

Thousands without power

Brittany and Normandy were among the regions worst hit in France, where 240,000 homes lost electricity, while in southern England, 150,000 homes were cut off from the power grid, the Energy Networks Association said.

Energy company Southern Electric said that some customers would be without power on Christmas Day.

McGivern told Al Jazeera another storm was expected to strike on Friday.

“That is expected to bring another spell of wet and windy weather,” he said.

IHS analyst Howard Archer said the weather was expected to hurt British retailers, eager to cash in on the traditional pre Christmas rush.

“Given retailers’ hopes that the last couple of days before Christmas would see a final strong surge in sales, the awful weather could not have come at a worse time,” Archer said.

 

Russia and Ukraine strike $15bn deal – Europe – Al Jazeera English

Russia and Ukraine strike $15bn deal – Europe – Al Jazeera English.

Russia and Ukraine strike $15bn deal

Moscow says agreement comes without conditions but there are fears it may inflame of pro-Europe protesters in Kiev.

Last updated: 17 Dec 2013 19:30
Russia threw Ukraine an economic lifeline on Tuesday, agreeing to buy $15 billion of Ukrainian bonds and to reduce the price its cash-strapped neighbour pays for vital Russian gas supplies by about one-third.

The deal, reached at talks in Moscow between the Russian and Ukrainian leaders, is intended to help Ukraine stave off economic crisis though Moscow will hope it keeps Kiev in its political and economic orbit.

The agreement could also fuel protests in Kiev against Ukrainian President Viktor Yanukovich, who faces accusations of “selling” Ukraine to the highest bidder after spurning a trade deal with the European Union and turning to Moscow for help.

Finance Minister Anton Siluanov said Russia would tap a National Welfare Fund – a rainy day fund – and use the $15 billion to buy Ukrainian eurobonds.

Announcing the deal after talks with Yanukovich, President Valdimir Putin said Russia would help Ukraine through its problems as big debt repayments loom but that there had been no discussion of Kiev joining a Russia-led customs union.

“The Russian government has made the decision to convert part of its reserves from the National Welfare Fund into Ukrainian securities. The volume is $15 billion,” Putin said in the Kremlin, with Yanukovich beside him.

“I want to draw your attention to the fact that this is not tied to any conditions … I want to calm you down – we have not discussed the issue of Ukraine’s accession to the customs union at all today.”

Ukraine’s Naftogaz energy company will pay Russia’s Gazprom $268.5 per 1,000 cubic metres of natural gas, on which it is heavily dependent. The previous price had been about $400 per 1,000 cubic metres.

The new price will take effect at the start of next month, Ukraine’s energy minister said.

Yanukovich’s visit to Moscow came as thousands of people continued to brave snow and freezing temperatures to call for his removal.

‘Blood on his hands’

Opponents are demanding greater EU integration and are angry about the country’s propinquity to the Kremlin.

They are also unhappy with his decision to keep opposition leader Yulia Tymoshenko in jail – a move also condemned by European leaders.

Yanukovich’s move to spurn Brussels sparked the fiercest anti-government rallies since the 2004 Orange Revolution that first nudged Ukraine on a westward path.

Mass protests have been met with accusations of police brutality. A protest on Saturday saw seven people hospitalised and dozens under arrest.

One opposition leader, Arseni Yatsenyuk, said the president had “the blood of our children, the blood of students, the blood of youth on his hands.”

The unrest has exposed fault lines between the nationalist and Ukrainian-speaking west of the country and the more Russified east aligned with Moscow.

The Ukrainian government has attempted to organise counter-rallies in Kiev but those have been dwarfed by the pro-EU protests.

 

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