Johnson's Russia List
24 March 2014
A project of the Institute for European, Russian and Eurasian Studies (IERES) at The George Washington University's Elliott School of International Affairs
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"We don't see things as they are, but as we are"

"Don't believe everything you think"

In this issue
1. Interfax: Russian Defense Ministry denies rumors about concentration of troops on Ukrainian border.
2. Moscow: No troop build-up or undeclared military activity near Ukraine borders.
3. Will the Ukrainian conflict turn hot? Ukrainian interim Prime Minister Arseniy Yatsenyuk has warned Russia than any attempt to annex areas of Eastern Ukraine will meet a very tough response, including a military one. EU in Brussels also spoke of measures beyond the already agreed, should Russia move into Ukrainian mainland. But does Russia have an appetite for East Ukrainian provinces and how likely is the escalation of this political crisis to a military one?
4. Valdai Discussion Club: Alexei Mukhin, Sergei Mikheyev and Alexei Fenenko, Crimea: What to Expect from Ukraine and the West.
5. Business New Europe: Ben Aris, KYIV BLOG: Interim Ukraine govt in the same hole as Yanukovych.
6. Anatol Lieven: Ukraine should be a bridge, not a battleground.
7. Why Respect Yanukovych (10 Reasons).
8. The Irish Times: Eamonn McCann, If we have to pick a side over Crimea, let it be Russia.
9. Congress of the Russian Union of Industrialists and Entrepreneurs.
10. Meeting with permanent members of the Security Council.
11. President Putin mocks US sanctions, vows not to retaliate.
12. Interfax: Moscow restaurants impose "entry ban" on Obama.
13. Interfax: Russians support Crimean accession to Russia - poll.
14. Al Jazeera: Sergei Khrushchev, Crimea: Whose land is this? Part 1. In order to understand the conflict in Crimea, one has to know the history of the peninsula.
15. Al Jazeera: Sergei Khrushchev, Crimea: Whose land is this? Part 2. Is it fair for the US to expect unconditional obedience from Russia against its own national interests?
16. Reuters: Sanctions bind Russia together, for now.
17. Christian Science Monitor: Fred Weir, Why US sanctions could play into Putin's hand. The post-Crimea sanctions are meant to squeeze top Russian officials and businessmen. But will the measures just push them closer to the Kremlin?
18. Russia may counter sanctions threat with foreign real estate ban for officials.
19. Sanctions effect: Russia to change its economic partners--for the better.
20. RIA Novosti: Ukraine-EU Pact Signals Step Towards NATO - Russian Ministry Source.
21. New York Times: Thomas Friedman, Foreign Affairs; Now a Word From X. (1998 interview with George Kennan)
22. Moscow Times: What the Papers Say, March 24, 2014.
23. Wall Street Journal: U.S. Scurries to Shore Up Spying on Russia. In Crimea, Russia May Have Gotten a Jump on West by Evading U.S. Eavesdropping.
24. Sources Tell CNN's Jake Tapper Russia Could Invade Ukraine over Weekend.
25. The Daily Mail (UK): 'Putin wants all of Ukraine': Kiev government warns that Russia is preparing to invade in the wake of Crimean independence vote.
26. The Guardian: Russian troops may be massing to invade Ukraine, says White House.
27. EU Observer: Russia to Europe: We can do whatever we want.
28. Euromaidan PR: Mychailo Wynnyckyj, Delayed invasion/May Gambit - Thoughts from Kyiv on 22 March 2014.
29. Paul Goble: Window on Eurasia: Russians Must Oust Putin Rather than Suffer for His Imperial Ambitions, Felshtinsky Says.
30. New York Times: Michael McFaul, Confronting Putin's Russia.
31. Moscow Times: Oleh Tyahnybok, We Will Stop Russian Aggression in Ukraine.
32. RIA Novosti: Russia Slams Robbery of Russian Train Passengers in Ukraine.
33. World Affairs Journal: Alexander J. Motyl, 'Experts' on Ukraine.
34. Voice of Russia: Ukrainians lay down three thousand weapons to police - Interior Minister.
35. Reuters: Disquiet in Baltics over sympathies of Russian speakers.
36. Reuters: Kiev woos oligarchs, bolstering east against Putin.
37. Sean's Russia Blog: William Risch, Ukraine: Two Heroes, Two Revolutions.
38. Washington Post: Farid Guliyev and Nozima Akhrarkhodjaeva, Why Ukraine's Euromaidan is not spreading to other post-Soviet states.
39. Business New Europe; Chris Weafer, Russia-Ukraine: Return of the Prometheans.
Russian Defense Ministry denies rumors about concentration of troops on Ukrainian border

MOSCOW. March 23 (Interfax) - Russia has no plans to concentrate its troops on the Ukrainian border, Russian Deputy Defense Minister Anatoly Antonov said.

"The Russian Defense Ministry observes all international agreements on the restriction of the number of troops in the areas bordering on Ukraine," Antonov said on Sunday, commenting on the reports published in some foreign media on the concentration of "thousands" of Russian troops on the Russian-Ukrainian border.

"By the way, this issue was raised many times in the course of the past month in telephone conversations between Russian Defense Minister General Sergei Shoigu and his foreign colleagues, including [U.S.] Defense Secretary Chuck Hagel and even acting Ukrainian defense minister Tenyukh," he said.

"Sergei Shoigu has very clearly told everyone about the real situation on the Russian-Ukrainian border and the lack of any intentions to concentrate troops there," he said.

"Europe has an objective criterion for evaluating a country's military activities. It's a regime of transparency and confidence-building measures in the sphere of conventional weapons, which is based on the Open Skies Treaty and the 2011 on Confidence- and Security-Building Measures," Antonov said.

"A set of measures allowing countries to get true information on each other's armed forces using inspections was developed and is being implemented as part of this regime. There are restrictions on their activities, which may influence the neighbors' security. If the established thresholds are exceeded, the countries have a duty to declare their intentions and, in some case, invite observers," he said.

"We strictly observe our obligations on these agreements," Antonov said.

Eight groups of inspectors visited Russia in the past month, he said. "Our objects and areas of deployment were inspected by the Ukrainian military twice. Besides, inspectors from the U.S., Canada, Germany, France, Switzerland, Poland, Latvia, Estonia, and Finland have visited our country. 'By accident,' most of them (seven missions) were interested in the regions adjacent to the Ukrainian border," he said.

"We have done everything to meet our partners halfway by allowing them to analyze all objects they were interested in. We have nothing to hide there," Antonov said.

"The foreign missions were able to meet with the command of the Russian units and divisions, photograph places of deployment of the personnel and military equipment, and monitor their routes. The conclusions that our foreign partners made at final briefings, which are a compulsory procedure, were that the Russian Armed Forces are not conducting any undeclared military activities that cold threaten the security of the neighboring states," Antonov said.

"For this reason, Sergei Shoigu called on the U.S. defense secretary to objectively evaluate the state of the military activities of the Russian Armed Forces in the regions adjacent to the Ukrainian border and not fuel tensions," he said.

"We are hoping that our Ukrainian and Western European partners will communicate the information on the real state of the Russian Armed Forces in the Western region to the political administration of their countries. We think that would help relieve the tensions, for which U.S. Secretary of Defense Chuck Hagel said in a recent conversation with General Sergei Shoigu," he said.


March 23, 2014
Moscow: No troop build-up or undeclared military activity near Ukraine borders

Russia is observing all international agreements on troop limits in regions bordering Ukraine, the Russian Deputy Defense Minister said, adding that foreign missions' inspections can confirm that.

The statement was made in response to reports by several foreign media outlets over concentrations of "thousands" of Russian servicemen on the Russian-Ukrainian border.

"By the way this issue has during the last month been regularly raised in telephone conversations between Russia's Minister of Defense Sergey Shoigu, and his foreign counterparts, including US Defense Secretary Chuck Hagel and even acting Ukrainian Defense Minister Igor Tenyukh," Anatoly Antonov, the Russian Deputy Defense Minister said.

Sergey Shoigu has, in a very transparent manner, informed all of them about the real situation on the Russian-Ukrainian border. He also stressed that Russia has no intention to concentrate troops there, Antonov said.

Following recent probes by foreign missions in Russia of Ukraine's bordering regions, foreign inspectors came to the conclusion that "Russian Armed Forces are not undertaking any undeclared military activity that would threaten the security of neighboring countries," Antonov added.

The official said eight foreign inspection groups have recently visited Russia.

"Our venues and regions, where troops are stationed near Ukrainian borders, have twice been checked by the Ukrainian military," the Deputy Minister said. "Besides, we have had on our territory inspectors from the US, Canada, Germany, France, Switzerland, Poland, Latvia, Estonia and Finland."

Seven of those eight missions were interested in Russian regions bordering with Ukraine, Antonov said. Foreign inspectors were allowed to talk to chiefs of the Russian military units, make pictures of deployment sites and military vehicles, and control them during relocation.

"We did our best to meet our partners' requests by allowing them to inspect all of the sites they wanted to. We have nothing to hide," Antonov said.

The deputy minister said he was hoping that participants of those inspecting missions would inform their countries' leaderships of what is really going on at the border between Russia and Ukraine.

"We believe this would to large extent facilitate release of tension, something the head of the Pentagon, Hagel, called for during his recent phone conversation with Minister Shoigu."
Germans, French 'nullified military co-op with Russia under pressure'

Berlin's and Paris' moves to halt military cooperation with Moscow are derailing the bilateral efforts of recent years and are completely unconstructive, Antonov said. However, according to the defense official, the two did so under pressure from their NATO ally.

"Obviously, the proverbial 'Atlantic solidarity' has made our French and German partners come up with loud statements against Russia," Antonov said.

"Refusing from contacts and delegatory exchange though military departments brings to naught the positive tendencies established in the recent years, including the cooperation on Afghanistan, the dialogue on transparency of military activity and military-technical cooperation. We perceive the decision of the German side as taken under pressure and unconstructive," Antonov stressed.

Both Russian and German defense ministries have recently undertaken some "serious efforts" in mutually beneficial cooperation, the official noted. He also highlighted the "unprecedented" bilateral work with France, including that of the Air Forces and Airborne Forces, noting that a "new impulse of cooperation" had been planned for 2014.

Addressing media on Sunday, Antonov stressed that Russia and its European partners are equally interested in military cooperation. It is "very easy to ruin what has been done by our countries [in the field of military cooperation] and it will be very difficult to restore relations," he said.

The Russian side hopes that Germany and France will review the situation on the Ukrainian border upon receiving reports from the international inspectors and will move to restore the severed ties, Antonov said. For now, Moscow will act in accordance with the "existing realities," he added.
March 24, 2014
Will the Ukrainian conflict turn hot?
Ukrainian interim Prime Minister Arseniy Yatsenyuk has warned Russia than any attempt to annex areas of Eastern Ukraine will meet a very tough response, including a military one. EU in Brussels also spoke of measures beyond the already agreed, should Russia move into Ukrainian mainland. But does Russia have an appetite for East Ukrainian provinces and how likely is the escalation of this political crisis to a military one?
Nikolai Gorshkov, special to RBTH

"We don't want the division of Ukraine"

Addressing the Russian parliament on the reunification with Crimea President Putin emphasized that Russia does not want the collapse of Ukraine. "I want you to listen well, dear friends", he said, sending this message to the Ukrainians.

"Do not believe those who are trying to scare you with Russia, those who are shouting that other regions will follow Crimea. We do not want the division of Ukraine."

But Ukraine is divided, if not physically, with a lot of ethnic Russians and Russian-speakers in East Ukraine not being very happy with strong nationalist and anti-Russian overtones in Kiev and the West of the country.

The regions of Kharkov, Lugansk and Donetsk used to be Russian provinces until they were annexed to historic Ukraine by the Bolsheviks back in 1918 for political and ideological reasons.

This is not to say that there is an overwhelming desire to reunite with Russia. In the 1991 referendum, the majority of East Ukrainians voted for independence from the Soviet Union, unlike the people of Crimea where the vote went the opposite way.

Since then there were ebbs and flows in the relationship between East Ukraine and the successive governments in Kiev who inconsistently pursued the policy of Ukrainisation of the region, sometimes halfheartedly, sometimes fairly vigorously.

Overall, there emerged a modus vivendi whereby the industrial East was allowed a degree of autonomy and closer ties with Russia that brought jobs and money to fill Kiev's coffers. Russian language was eventually recognised as official in the region alongside the Ukrainian.

Status Quo breached

The violent change of guard in Kiev in February has breached the status quo. An immediate attempt to repeal the language law and the replacement of homegrown governors and mayors with pro-Western appointees from Kiev have led to unrest, which while being played down by Kiev is seen as a cause for major concern in Moscow.

President Putin voiced this concern in his address to both houses of the Russian parliament.

"Millions of Russian people, Russian-speaking citizens live and will continue to live in Ukraine, and Russia will always defend their interests by political, diplomatic, and legal means. However, primarily Ukraine itself, should be interested that the rights and interests of these people are secured - this is the guarantee of stability of the Ukrainian statehood and the territorial integrity of the country," Putin said.

Earlier he had secured the permission of the parliament to use the Russian military to protect Russians and Russian speakers in Ukraine. But will he avail himself of this permission?

A failed state?

That depends mostly on Ukraine, and partly on the international community, believes Ruslan Pukhov, Director of a Moscow Centre for analysis of strategies and technologies, AST.

"Ukraine is basically a failed state and if the ultra-nationalists consolidate their grip on power, and blood is spilled in East Ukraine as a result, Russia would not be able to stay away. She would be damned for whatever she does, so she may as well do what she thinks is right", says Mr. Pukhov.

>From a purely military point of view there appears to be no real obstacle to the Russian forces crossing into mainland Ukraine. Its acting Minister of Defence Ihor Tenyukh admitted that the Ukrainian army is in a very poor state. This was demonstrated by the swift takeover of all Ukrainian military bases in Crimea by the pro-Russian forces.

Admiral Tenyukh said Ukrainain army could not retaliate because there was no formal declaration of war from Russia and any military action by the Ukrainian side would place the blame for the start of hostilities squarely on Kiev. Moreover, the Ukrainian officer corps is suffering from split allegiances.

Chief of Ukraine's General Staff Admiral Yuriy Iliyn, suspended by the new government in Kiev but still a voice of authority to many Ukrainian officers, has called on them to keep calm and composure and refrain from opening fire on their Russian brothers as he put it.

However, moving into East Ukraine will present all sorts of logistical and security challenges, believes George Friedman, Chairman of Startfor, a leading consultancy in the field of global intelligence.

"First, Ukraine is a large area to seize and pacify. Russia does not need an insurgency on its border, and it cannot guarantee that it wouldn't get one, especially since a significant portion of the population in western Ukraine is pro-West. Second, in order for an invasion of Ukraine to be geopolitically significant, all of Ukraine east of the Dnieper River must be taken. Otherwise, the frontier with Russia remains open, and there would be no anchor to the Russian position", opines Mr. Friedman.

No appetite for a bigger burden

The porousness of the thousand mile long Ukrainian-Russian border will make it extremely difficult to contain infiltration by Ukrainian nationalist militants, says Ruslan Pukhov of AST.

He believes, East Ukraine would be a huge liability to Russia, not just in military but in economic terms as well. He points that Crimea will need a lot of material help from Moscow after 23 years of neglect, and the cost of it will dampen any appetite, if there is any, for East Ukraine.

However, Mr. Pukhov repeats, "if the Russian population in Ukraine is mistreated Russia would have no choice but to intervene, the way it did in Crimea". He is certain there had been no plans to seize Crimea, and what happened there was a complete improvisation in response to the threat from the nationalist government in Kiev.

If it was an improvisation, it was a well-prepared one, believes a former FSB (Federal Security Service) General Yevgeniy Lobachev. The way events in Crimea unfolded, he told news resource, proves that Russia was closely monitoring the situation and stepped in at the most opportune moment.

If the newly formed Ukrainian National Guard, comprised of radical nationalists, starts mischief, as General Lobachev put it, Russia will have legal grounds to intervene to protect civilians in other parts of Ukraine.

Cold war is better than a hot one

To George Friedman of Stratfor the jury on a possible escalation of the conflict is still out. Russia, he believes, can afford to "do nothing. The government in Kiev is highly fractious, and given the pro-Russian factions' hostility toward moving closer to the West, the probability of paralysis is high."

But what is a likely course of action for the West? Will it be tempted to get involved militarily? In Mr. Friedman's view, "having chosen to support the creation of an anti-Russian regime in Ukraine, the United States now faces consequences and decisions. The issue is not deployments of major forces but providing the Central Europeans from Poland to Romania with the technology and materiel to discourage Russia from dangerous adventures."

The Cold War ended far better than the wars the Americans became directly involved in, it never turned hot in Europe, Mr. Friedman reminds. "Logic has it that at some point the United States will adopt this strategy."
Valdai Discussion Club
March 24, 2014
Crimea: What to Expect from Ukraine and the West
By Alexei Mukhin,  Sergei Mikheyev and Alexei Fenenko

On March 16, Crimeans attended a referendum on the status of their region, at which 96.77% of them voted for joining Russia. Moscow immediately set in motion the procedure for incorporating the peninsula. Valdai Discussion Club experts Alexei Mukhin, President of the Center for Political Information, political analyst Sergei Mikheyev and Alexei Fenenko, Leading Research Fellow at the Russian Academy of Sciences' Institute of International Security Studies, comment on the referendum results, Russia's moves, possible consequences for Russia and Ukraine, Western refusal to recognize the referendum results and many other related issues.

Sergei Mikheyev believes that Russia should not worry about the West's refusal to recognize the results of the Crimean referendum. "Russia's foreign policy stance has changed: the policy of endless concessions to the detriment of its national interests has fortunately come to an end," he said. "In the 1990s, we did not have any foreign policy stance. We ceded national interests one after another, destroying the country."
The West, above all the United States, would like for a rival country to have no reputation at all. They do not want to have any rivals, or at the worst, they want their rivals to be absolutely loyal to them. When problems in Ukraine came to a head, the West urged Russia to take its stance of the 1990s, that is, to forget about its interests and cede yet another part of its zone of influence by accepting the overthrow of a legitimate president by anti-Russian forces and neo-fascist groups.

Instead, Russia has stood up to show that it "has interests, primarily along the perimeter of the Russian borders in the post-Soviet space, and that it will protect these interests," Mikheyev said. According to him, Russia will be showered with dirt, as in the case of South Ossetia, but common sense will ultimately take the upper hand.

The main thing is that the Crimeans' nearly unanimous vote for joining Russia has restored historical justice, the political analyst said.

As for the situation in Ukraine and its future, Mikheyev believes that Ukraine is tottering on the edge of dissolution, mostly because of the country's ultra-patriots, who have seized power shouting "Glory to Ukraine!" and who, together with their Western partners, precipitated the current critical situation. The expert said that the presidential elections scheduled for May 25 would be held in a high-strung atmosphere, with elements of harsh political pressure. The Kiev authorities are already trying to physically remove all possible election rivals. According to Mikheyev, "the new Ukrainian authorities' actions cannot be described as systematic policy."

Regarding Western sanctions against Russia over Crimea and who will stand to suffer from them, the first to be hit will be Germany, he said. Americans want to weaken Germany, which is playing first fiddle in the EU, and also to strengthen some of their other allies, in particular Britain. But Washington's ultimate goal is to prevent its weakening role in Europe and Russia's rapprochement with Europe, primarily Germany.

Sanctions, if they are implemented, will be designed to help the West save face, Alexei Mukhin said. The West has made so many advances and its rhetoric has been so radical that it cannot back off, just as Russia cannot reverse the results of the Crimean referendum. "I think that those Western countries that called for economic and other sanctions against Russia will be maneuvering now," Mukhin said.

The West is shouting that the Crimean referendum was held "under threats of violence and intimidation." But everyone knows that this is a lie and that Russia did not dispatch its troops to the peninsula.

Are the accession of Crimea and Russia's stance worth the reputation risk, considering Russia's desire to improve its image abroad? "If we keep thinking what impression our actions will make abroad, we will not advance much further in our development," Mukhin said. The West has broadly hinted that might is right. Russia should not blindly follow this principle on the foreign policy stage, but firmly protect its stance and principles while acting within the framework of international law. Mukhin believes that what happened in Crimea was logical, and that Russia has successfully made this opinion public knowledge. "I don't see any major risks or loss of image for Russia," he said. In fact, the image that some liberally minded experts have been promoting is largely artificial and was designed to fit the standards which the West has been forcing on Russia.

"We have passed a certain point in the escalation of the Russian-Ukrainian conflict, beyond which a war is highly unlikely," Mukhin said. "This is because passions are running very high and in this affected state the Kiev authorities can spur the conflict to a new level. But I sincerely hope that this will not happen." In fact, disintegration processes are rapidly developing in Ukraine, and politicians have been unable to stop them, the expert said.

The integration of Ukraine's Security Service with Right Sector has had an openly negative effect and could be highly destructive for the country and its economy.

As for the May 25 elections, Russia's recognition of the new authorities created at these elections, or its refusal to recognize them, will directly depend on the format and legitimacy of the elections.

Alexei Fenenko said that the West's refusal to recognize the results of the Crimean referendum is nothing new in international practice. There have been many precedents. For example, the West did not recognize East Germany until 1973, and the United States never recognized the incorporation of the Baltic countries into the Soviet Union before World War II. Non-recognition does not actually amount to confrontation.

As for the legitimacy or illegitimacy of the Crimean referendum, it fully complied with the guidelines on the recognition of new states in Eastern Europe and in the Soviet Union, which the European Commission drafted in December 1991, Fenenko said. These guidelines stipulate full compliance with international treaties, the primacy of the Helsinki Final Act, the inviolability of new administrative borders, peaceful settlement of disputes and guarantees of the rights of minorities. As can be seen from the new Crimean leadership's talks with Crimean Tartars, they are acting in compliance with all of these principles.

As for Kiev's policy, the new Ukrainian authorities are disunited and do not have a concrete policy, goal or concept for overcoming the crisis. We see a battle between several forces there: relatively moderate forces, the nationalist sector and oligarchic groups. They do not have a common program.

Ukraine will not regain Crimea, as both Kiev and Washington know, Fenenko said. But further developments can take one of several directions. One possibility is a battle for southeastern Ukraine, where people can cite the example of Crimea to demand federalization, if not accession to Russia, the expert said. They can demand the creation of a South-Eastern Autonomous Republic with its capital in Kharkiv, in accordance with the decision made by the Donetsk regional council in 2004. Kiev can make a show of punishing Kharkiv, thereby provoking serious unrest, to which Russia will have to react.

Fenenko said that London, Washington and Brussels can start considering the possibility of Ukraine splitting into several states, and which parts they would control. The expert believes that Ukraine has already split. In the past three years, US experts wrote that there would not be a second Yalta conference with Russia, but practice shows that they will eventually have to sit down at the same table with Russia to discuss outstanding issues. The main thing is to prevent the enactment of the Yugoslav scenario in Ukraine, Fenenko said. In general, the fate of Ukraine will not be decided in Kiev, but in Moscow, Washington, Brussels and other European capitals.

Fenenko believes that with Crimea joining Russia, Ukraine has only one positive solution left: to become a federal state as soon as possible. This can make Ukraine a better balanced state, guaranteed by international agreements. Otherwise, an uncontrollable disintegration process could begin in Ukraine, which is unlikely to survive as a unitary state.

Business New Europe
March 24, 2014
KYIV BLOG: Interim Ukraine govt in the same hole as Yanukovych
Ben Aris in Moscow

The interim Ukrainian government signed off on the long-mooted Association Agreement with the EU at the weekend, setting the impasse with Russia in stone. However, the "Maidan" government baulked at signing the economic part of the deal. Is the new administration about to find itself in exactly the same place as ousted president Viktor Yanukovych did: refusing to sign the full agreement with the EU unless it gives Ukraine more money? That would be ironic.

Ukraine is bankrupt and needs billions of dollars fast to prevent a full-blown meltdown. The problem is the EU is not in good financial shape either and cannot afford to bail out yet another country.

The EU is already on the hook for the economies of Greece and Cyprus, with the southern states like Portugal, Spain and Italy also in deep trouble. How can the EU justify shelling out the $35bn (just for this year) that the Ukraine government is asking for but at the same time continue to drag its heels over bailouts for the other states already in the EU? Moreover, this would be an extremely hard sell politically, both regionally (as Germany would have to foot the bill) and domestically as populations are tired of being asked to pay for other countries (and banks) while their own living standards are falling.

Yet this is where we are heading. So far the EU's game to take Ukraine from Russia has been all tactics and no strategy. The money on the table is simply not enough to even get Ukraine through this year, let alone pay for the deep structural reforms and recovery.

The EU added another $1.4bn to its bailout package over the weekend, bringing the total on offer to around $15bn "over several years."

"The EU decided to increase financial aid to Ukraine from €610m to €1.61bn," Ukraine's UNIAN agency quoted PM Arseniy Yatsenyuk as saying.

"Over $2bn will be transferred to accounts of the Ukrainian government to stabilize economic situation in Ukraine. The deadline for the transfer is late April or early May," the premier continued, reports RIA Novosti.

At the same time, the US has almost voted through $1bn in credit guarantees to help Ukraine get through this rough patch.

This money is laughably insufficient.

Run through the numbers. Ukraine has between $12bn and $15bn (depending on who you ask) in hard currency reserves, or less than two months' import cover, which is not enough to maintain the stability of the currency. Moreover, the economic damage done by the three months of protests almost certainly guarantees that the economy will contract this year.

In terms of outgoings this year, the state has some $7bn worth of debt redemptions, including payments due to the International Monetary Fund (IMF). Russia is almost certain to increase the price it charges Ukraine for gas from the "special price" of about $260 per thousand cubic metres to around the $400 it was charging under the terms of the deal cut by former PM Yulia Tymoshenko in 2009, and even suggested last week that the price may be increased to $500. This price hike will cost Ukraine an extra $7bn a year in fuel bills. That's $14bn right there, all of Ukraine's reserves, and that is before you spend a penny on pensions, teachers or new power stations.

Add to this is that Ukraine owes Russia's Gazprom another $2bn for gas deliveries this year and the Kremlin has reintroduced the unpaid bill of $7bn from last year. If you include the $3bn of Ukrainian bonds that Russia bought in December, Russian Prime minister Dmitry Medvedev said over the weekend that Ukraine's total debt to Russia is about $16bn - more than the country's entire hard currency reserves.

EU foreign policy chief Catherine Ashton voiced deep concern on March 22 over the fragility of Ukraine's economy and said a short-term budget deficit problem had to be resolved "relatively quickly". But while there is a lot of talk about rallying the global community to bail out Urkaine, there's so far very little in the way of actual commitments.

"We have to make sure that Ukraine, economically, does not fall over... My biggest fear right now is the state of economy and the need for us all to offer the support that they need," Ashton told an event organized by the German Marshall Fund think-tank. "How do we make sure this economy holds together?"

An IMF team was in Kyiv all of last week to assess the situation and work out the details of a new stand-by loan programme. It was supposed to announce the details on March 21, but delayed the announcement to sometime this week. The Fund earlier said that no IMF money could be released until April, though last week admitted that even this date would probably be missed.

PM Yatsenyuk travelled to Brussels on March 21 to sign the political provisions of its association agreement with the EU, and on March 24 will be at the IMF office. Clearly he is lobbying for more money and must have asked for more from the EU over the weekend.

For its part, the EU also said that it would accelerate dropping some of its trade tariffs immediately. Under the terms the Deep and Comprehensive Free Trade Agreement (DCFTA), Ukraine was due to drop its barriers immediately, while the EU would drop its own barriers "eventually" depending on Ukraine's progress with deep and painful structural reforms. The concession made last week to drop more barriers early sounds good, but economists say it is actually worth about $200m over five months.

Yatsenyuk said the economic part of the agreement, rejected by the previous government over fears of significant economic losses, will be signed only after the presidential election due on May 25.

Arguably, it should have been the other way round: the economic part of the deal - the whole point of signing up to the EU in the first place - should have been signed now and the political part, that sets Ukraine in permanent conflict with Russia and ignores the interests of the population in the east of the country, should have been signed after the presidential elections when those people actually have some representation in the government.
Subject:     Ukraine should be a bridge, not a battleground
Date:     Sun, 23 Mar 2014
From:    Anatol Lieven <>

An abridged version of this essay appears in the current issue of the British magazine Prospect. It draws attention amongst other things to the economic and political dilemmas that the EU will face when it tries to promote reform in Ukraine - something that does not seem to have been noticed by the great majority of commentators.
Anatol Lieven

Ukraine should be a bridge, not a battleground
By Anatol Lieven
Department of War Studies
King's College London

      In recent weeks, rational argument concerning Ukraine in both Russia and the West has been overwhelmed by a flood of hysteria, lies and self-deceptions. Russia has engaged in openly mendacious propaganda. Western governments and too much of the media have responded with lying counter-propaganda of their own.
          There is no space in this essay to dissect all the competing propaganda claims of both sides. Instead, I would direct readers to an excellent article on the subject by the Israeli journalist Ariel Danieli ("From Washington to Moscow, Everyone is Lying About What is happening in Ukraine", March 6th 2014, at
    Among other important points, Danieli writes correctly that while Moscow is lying in describing the overthrow of Yanukovych as a "neo-fascist coup" rather than a popular uprising (albeit against a democratically elected president), Washington is no less mendacious in claiming that "far-right ultranationalist groups are not represented in the Rada [the Ukrainian parliament]" and have no influence over the new government.
    This is a grotesque claim, given that the ultra-nationalist and savagely Russophobe Svoboda ("Freedom" party) in fact has 38 seats in parliament and four ministers in the government including Minister of Justice and Deputy Prime Minister. Svoboda's founder, Andriy Parubiy, has become secretary of the National Security and Defence Council, with his ally Dmytro Yarosh, leader of the neo-fascist Right Sector group, as his deputy.
    In a resolution of December 13th 2012, the European Parliament declared of Svoboda that:
"MEPs voice concerns about the rising nationalistic sentiment in Ukraine which led to the election of the "Svoboda" Party to the Parliament of Ukraine. The EP recalls that racist, anti-Semitic and xenophobic views go against the EU's fundamental values and principles and it appeals to pro-democratic parties in the Ukrainian Parliament not to associate with, endorse or form coalitions with this party." ("Elections failed to Bring Ukraine Closer to EU, Say MEPs", at
          It should be clear therefore that while Moscow has grossly exaggerated the immediate physical threat to Russians in Ukraine as justification for its military moves in Crimea, Russians and Russian-speakers do have good reasons to fear for their rights under the new Ukrainian government; and the EU and its member states were premature in recognizing that government and promising it massive aid without first insisting on changes in its composition and firm guarantees of minority rights. Russia has violated international law. The West has violated its own principles and interests.
    The real danger in Ukraine does not lie in Crimea. One way or another, Crimea is almost certainly now lost to Ukraine, even if no-one but Russia recognises this formally. The danger comes from the possibility of clashes between the Ukrainian nationalist and neo-fascist volunteers who led the overthrow of the previous government in Kiev and opposing Moscow-backed pro-Russian volunteers in the east of the country. If they get out of hand, such clashes could lead to Russian invasion, war and the partition of Ukraine. It is therefore urgently necessary to recreate in Ukraine an agreed and legitimate democratic process that will safeguard minority rights.
    The stakes here are high for all sides. If war begins, Russia would almost certainly win it (since the USA and Britain, despite their attempts to bring Ukraine into Nato, have no intention of fighting to defend the country), but would suffer colossal damage in the process. In the short term there would be a shattering economic crisis. In the longer term, Russia would face a collapse of economic and cultural ties with the west that would drive it inexorably towards the status of a satellite of China-a prospect, by the way, that terrifies liberal and nationalist Russians alike. The result would be a stagnant, closed and increasingly authoritarian Russian system.
    The damage to the west would also be considerable. If the west introduced economic sanctions and Russia responded with a massive rise in its gas prices (or if gas supplies to western Europe across Ukraine were cut off by conflict), the result could very easily be a new European and global recession. China would benefit greatly from the acquisition of Russia as an unconditional ally, and from the sheer distraction of US attention that war would bring. Propping up the remains of Ukraine economically would be a massive financial burden for the EU. And the sight of the USA and Nato again standing impotently by while a quasi-ally is defeated in a war for which western policy was partly responsible would be a humiliation that would embolden America's global rivals.
    It is important to remember that Ukraine is a deeply divided society that cannot make a categorical choice between the west and Russia without tearing itself apart. Since independence, a sense of common identity and loyalty has certainly developed, but it remains fragile and ambiguous.
    The reasons for this lie not in recent policies but in the historic division from the 13th century onwards of the ancient lands of Rus between the Tsardom of Muscovy, the Polish-Lithuanian kingdom and, to the south, the steppe, disputed between Crimean Tatars and Ukrainian Cossacks, and largely uninhabited until it was conquered by the Russian Empress Catherine the Great in the 18th century.
    From the 17th century on, the Ukrainian-speaking parts of Poland-Lithuania were progressively conquered by the Russian Empire, leading many Orthodox Ukrainians to strongly identify with Russia. This process was completed by Stalin's annexation of Polish Galicia and Volhynia in 1939-a region that had never been under Russian imperial rule and which remains the most strongly nationalist and anti-Russian part of Ukraine today.
    One way of explaining the resulting Ukrainian identities and relationship to Russia to a British audience would be to say that they include elements of both the Scottish and the Irish historical experience in Britain. On the one hand, the Russian Empire and the Soviet Union severely repressed Ukrainian nationalism (beyond purely symbolic forms), and persecuted Ukrainians belonging to the "apostate" religious tradition of the Uniates (Orthodox who, under Polish rule, had acknowledged the supremacy of the Pope). On the other hand, both in Russia and in the Soviet Union, "loyal" Ukrainians permeated the state system and rose to its highest echelons.
    In the field of literature, the distinction is symbolised by Ukraine's two greatest 19th-century writers. Nikolai Gogol ("Mykola Hohol" in Ukrainian) could be seen as analogous to writers such as Walter Scott and John Buchan, conscious of their Scottish identity and often writing on Scottish themes, but loyal to Britain and the British Empire. The Ukrainian nationalist poet Taras Shevchenko, in contrast, more closely resembles 19th-century Irish nationalist writers such as James Clarence Mangan or Arthur Geoghegan-though since Britain had been able to crush the Irish language much more effectively than the Russian Empire had crushed Ukrainian, these Irish writers also wrote in English.
    In a pattern familiar from the British Empire, Russian and Soviet rule also brought about huge and complex patterns of migration. Large parts of southern Ukraine were settled by Russians (and by Germans invited in by Catherine, until Stalin deported them to Central Asia). More Russians moved later to work in the mines and factories. At the same time, however, millions of Ukrainians migrated to Siberia and the Russian Far East, where (the last time I checked) a majority of senior officials and local deputies had Ukrainian surnames. The difference was that under rule from St Petersburg and Moscow, Ukrainians who moved to what is now Russia soon gave up the Ukrainian language and merged into the Russian population; whereas Russians who moved to Ukraine not only kept their language but through intermarriage helped the state extend the Russian language to much of the neighbouring Ukrainian population.
    As a result of Ukraine's history, some 17 percent of Ukrainians consider themselves ethnic Russians, while around a third of Ukrainians speak Russian as their first language. These figures, however, mask a more complex reality. For instance, in Dnipropetrovsk I met one Russian-speaking man with a Russian surname who spoke Russian at home, but who considered himself ethnic Ukrainian because he was brought up by his Ukrainian stepfather after his Russian father walked out. I also met an "ethnic Russian" with a Ukrainian surname who considered himself Russian because he was brought up as such by his Russian-speaking Armenian mother. Both said that their political identity was Ukrainian, and both strongly believed in Ukraine seeking close relations with both Russia and the west.
    The result of this history is that a great majority of western (and increasingly, central) Ukrainians find it intolerable that Ukraine should form part of a Russian-dominated economic and political bloc. A majority of eastern and southern Ukrainians, for their part, find it intolerable that they should be separated from Russia by a hard international frontier (including a tight, EU-mandated visa regime) and that the Ukrainian state should insist on a version of Ukrainian identity and culture that they do not share and which is, in part, deeply hostile to them. These two identities have dominated Ukrainian politics since independence, with elections decided by small shifts in the middle ground between them, represented by people like my two acquaintances from Dnipropetrovsk.
    The problem for the west is that while many of the pro-western Ukrainian forces are genuinely committed to western-style reforms, others are traditional nationalists who look to Nato and the EU for protection against Russia, without sharing mainstream liberal values. This may either make Ukraine's integration into the west impossible or (as has already occurred in the case of Hungary) import into the EU forces which will ally with western European neo-fascist parties.
    The problem for Russia in eastern and southern Ukraine is that a desire to keep the Russian language and close ties with Russia can co-exist with a desire for closer ties with the EU (though not with Nato). It is not at all the same thing as a desire simply to become part of Russia or even a subordinate member of a Russian alliance.
    An analogy here might be drawn with the "Anglosphere" tendency in English-speaking countries. A large majority of British, Australian and Canadian citizens desire (to varying degrees) close relations with the United States, and would reject the idea of joining an anti-American alliance. But this does not indicate a desire for unconditional subordination to the US.
    Similarly, to judge by my own travels in eastern and southern Ukraine, outside Crimea, even many people there who are strongly hostile to the new government in Kiev would also be deeply hostile to Russian military intervention and the partition of the country. Russian threats of intervention may well be frightening more Russian-speakers in Ukraine than they reassure.
    Ever since the collapse of the USSR in 1991, both the Yeltsin and the Putin administrations have made assiduous attempts to keep Ukraine in Russia's orbit. This has been very costly for Russia-just as from now on, a serious attempt to draw Ukraine into the west's orbit is going to be costly for the west.
    Until 2005, Russia supplied Ukraine with gas at well below world market prices, amounting to aid to Ukraine of between $3bn and $5bn a year, at a time when Russia itself was undergoing a terrible economic crisis. This was several times the average annual aid from the west during those years. Indeed, all EU aid put together from 1991 to 2013 came to a mere $4.6bn. Ukraine's failure to pay its gas bill even at subsidised prices led to repeated disputes and interruptions of Russian supplies-to which Ukrainian governments responded by diverting gas from supplies heading for the EU.
    In 2010, Russia agreed to reduce the price of its gas to 30 percent below world market levels (but rising to those levels gradually over several years), as part of a deal by which the newly-elected government of President Yanukovych agreed to extend the Russian lease of the naval base of Sevastopol in Crimea to 2042.
    In December 2013, as part of the bidding war with the EU over whether to join the Eurasian Union or sign an association agreement with the EU, Russia signed a deal with Yanukovych reducing the price of its gas by a third. It also gave $15bn to help Ukraine meet its international debt repayments. This, too, was vastly greater than anything on offer from the EU as part of the association agreement, and equally importantly came with no conditions for reform.
    Following the revolution, the EU is also now discussing a $15bn aid package for Ukraine (which has asked for $35bn)-something that, had it been presented to European governments before the revolution, would have been rejected out of hand. What the EU cannot match-because western European countries will not tolerate it-is something that Russia has allowed Ukraine ever since independence, namely free labour movement. As a result, the three million or more Ukrainian citizens working legally in Russia today outnumber those allowed to work legally in the EU at least 10 times over.
    What this history illustrates is that until a few weeks ago, Ukraine was of very minor importance for the EU, whereas for Russia it was always a priority. It would have been well if EU leaders had understood this before devising their policies-but then the EU has always been poor at thinking strategically.
    The Russians, however, have made a mistake of equal magnitude. Russian officials have been exasperated by the way in which their generosity to Ukraine has repeatedly led to few benefits for Russia, while a growing number of Ukrainians have supported closer relations with the EU despite the much smaller short-term advantages on offer. What Russian officials have failed to recognise is that Ukrainians have become increasingly disgusted with their own oligarchical elites, and see entry into a bloc dominated by a corrupt and semi-authoritarian Russia as permanently consolidating an already rotten system.
    The EU has made what is in some respects the opposite mistake where the latest Ukrainian uprising is concerned. Most western analysts have explained the desire of central European populations to join the EU in terms of a wish to westernise their polities, economies and cultures. But they have underestimated the degree to which this was driven by a nationalist yearning to escape the hated Soviet-Russian yoke.
    As a consequence, they have not understood to what extent it was this nationalism that allowed the acceptance by populations of the extremely painful economic and cultural changes necessary to join the EU. If they rejected these changes, even conservative and populist central Europeans who opposed westernisation feared that they would find themselves once again under the domination of Moscow. But as we have seen in Hungary, Poland and elsewhere, once safely in Nato and the EU, strong chauvinist tendencies re-emerged, encouraged by deep popular anger at the corruption and social inequality which accompanied the economic revolutions of the 1990s.
    Due to the drawing of new frontiers after the First World War, and ethnic cleansing after the Second, most of the central European states are at least ethnically homogenous with united national identities (the chief exception being the former Yugoslavia). Ukrainian identity, as we have seen, is deeply divided, albeit in complex and ambiguous ways.
    This leaves the EU after the recent Ukrainian revolution in a situation which may well prove horribly expensive, extremely dangerous and deeply unpopular. Until February 2014, the EU's position (quite rightly) was that to qualify for closer European ties and greater EU aid, Ukraine had to implement a set of deep and very painful reforms. Now, this pressure will have to be largely abandoned for fear that any such changes would drive the populations of eastern and southern Ukraine into the arms of Moscow. On the contrary, the west is contemplating enormous aid packages to Ukraine with no real strings attached.
    This in turn means that-unless the EU is prepared simply to tear up the acquis communautaire for the sake of Ukrainian entry, and infuriate western European populations in the process-Ukraine will not in the foreseeable future be able to join the EU, at which point much of the promise behind the Ukrainian revolution collapses.
    It was a highly symbolic move, therefore, for the new Ukrainian government to appoint a number of Russian-speaking oligarchs to governorships in eastern Ukraine. This is a wise political move intended to reassure the local populations and win over the eastern Ukrainian elites. It is not, however, obviously compatible with the government's commitment to economic reform.
    The result of all this is likely to be Ukraine stuck in a permanent and miserable halfway-house to the EU, like Turkey but without Turkey's independent economic dynamism. In these circumstances, it may not be too long before many Ukrainians hold the EU responsible for betraying them, while the new state oligarchs steal western aid as their predecessors stole Russian aid. Remember: the majorities in Ukrainian opinion polls have been for membership of the EU, with all its benefits-not for an endless accession process.
    So far, however, it is Russia that has suffered a crushing defeat, compared to which anything suffered so far by the west is minor, and Crimea is a very small consolation prize. Putin's plans for the consolidation of Russia's economic and political influence in the former Soviet region and economic role on the world stage centred on the creation of the Eurasian Union including Ukraine. Without Ukraine, this bloc cannot possibly emerge as a significant international grouping. The demonstrators in Kiev have killed forever the plan for Ukraine to enter the Eurasian Union. On the other hand, as we have seen, Ukraine's path towards the EU is also strewn with obstacles, and can also easily be blocked by Russia through its influence over parts of Ukraine.
    In these circumstances, it seems to me sensible and a recognition of reality if, as part of a Ukrainian settlement, Russia, Nato and the EU help to reduce the tension in Ukraine, and between Russia and the west, by declaring a lengthy moratorium on any new offer of accession or partnership. They should also propose an amendment to the Ukrainian constitution stipulating that Ukraine's accession to any international organisation needs a majority of at least 70 percent in a referendum.
    Above all, it is necessary to reduce tension within Ukraine and prevent possible clashes between Ukrainian nationalist and Russian-backed militias, which could lead to full-scale Russian invasion.
    The Russian annexation of Crimea is both a very serious crime under international law and a dreadful mistake from Russia's own point of view. This does not however diminish the necessity to prevent conflict in the rest of Ukraine. This requires above all agreement between the west and Russia, and between the new government in Kiev and former supporters of President Yanukovych from the east and south, on how to hold new elections, and on the shape of a new Ukrainian constitution. As part of this agreement, anti-government groups in eastern Ukraine would call off their attempts to storm government buildings and oust officials appointed from Kiev (though of course from their point of view, they are only following the model set by the groups which ousted President Yanukovych).
    The west should make greatly increased aid to Ukraine conditional on the following moves by the government in Kiev: the ministers and deputy ministers of the interior, defence and justice, and the secretary and deputy secretary of the National Security Council, should be neutral professional officers until after the next elections; an agreement that these elections should take place under close United Nations supervision, to prevent rigging and intimidation by either Ukrainian nationalist or pro-Russian militias. As it has in other deeply divided countries, the international community should constrain Ukraine to adopt a new federal constitution, restoring the election of governors and granting real local power to the different regions.
    It is both dangerous and wrong in principle that a state as diverse as Ukraine should have a highly centralised constitution under which, for example, the new Ukrainian parliament could pass a law (subsequently blocked by the president under discreet western pressure) abolishing the official status of Russian and other minority languages, not only at the national level but in provinces where a large majority of the population speaks Russian as its first language. These proposals are not "concessions" to Russia; they are in accordance with the west's own interests and values.
    Henry Kissinger, one of the very few senior American figures to have kept their heads in this crisis, wrote earlier this year: "Far too often the Ukrainian issue is posed as a showdown: whether Ukraine joins the east or the west. But if Ukraine is to survive and thrive, it must not be either side's outpost against the other-it should function as a bridge between them."
    It has been demonstrated beyond doubt that neither Russia nor the west can achieve their maximal goals in Ukraine. What they can do, however, is to work endlessly to block each other's goals-and to destroy Ukraine in the process.

Brit in Ukraine
Why Respect Yanukovych (10 Reasons)
By Graham Phillips March 21, 2014

1. Economy down -15% in 2009. No problem - elect Yanuk in February 2010 and enjoy more than 4% economic growth that year!

You're welcome!

2. Lose Euro 2012? A real possibility with global superpower Scotland (sorry guys) offering to take it twice in 2008 and Michel Platini expressing grave doubts over Ukraine. Big Vik is not having that, and sets about saving the tournament as soon as he's elected, stating on April 1st 2010 -

"We have accepted this challenge, and I believe we will prepare properly. This year we will move on this issue so our country won't be ashamed in 2012."

Ukraine keeps Euro 2012, and is not ashamed.

3. All that talk of 'Ukraine is one country' these days. A little hollow isn't it? Under Yanukovych though, Ukraine really was one country. Secession wasn't even a word. Why? Well, because he had some strong pockets of support in the west of Ukraine, and Crimea loved Vik to the tune of 78%.

4. Inflation. Remember that in Ukraine. 26% in 2008. What was inflation in 2012, under Yanuk? 0.1%. If anything, a bit too low, but, anyway, nice work Vik!

5. Unemployment. Over 10% in 2009, record high. Fast forward to 2013 -

"Analysts say Ukraine's labor market is stable and riding a positive trend. According to ILO polls, unemployment rate in Ukraine is down. During the first half of 2012, it was 7.8%; during the first half of 2013, it was reduced to 7.5%."

Put it there!

6. No question that Yanuk, over 6ft 3 inches, could be a bit of a bully when he wanted to. But why isn't that a good thing if it helped him finish off Ukraine's weakest ever senior political figure, Viktor Yushchenko. Yushchenko just couldn't live with Vik, at times openly pleading to parliament "He's bullying me!", before nominating Yanukovych as Prime Minister as the Orange Revolution started to fall apart as early as 2006.

7. Freedom of the press. I worked for What's On magazine on Khreschatik in Kiev 2012, 1 floor above the Party of Regions office. Every week, our publisher Neil Campbell used to find new ways to describe Yanukovych as variously an idiot, thug, idiot thug. Have a look through the near 500 references to Vik, here. Find a positive one?

Anyway, the response from the Party of Regions was brutal. They came up once when they'd run out of coffee.

8. Yanukovych stood up to Putin. In October 2010, his counterpart had visited Kiev determined to put a few things on Vik's toes - join the Customs Union and leave the raids off the Russian companies. As reported by the Moscow Times -

"Yanukovych did nothing to accommodate Putin."

More than that, Yanuk actually started badgering Vovar for renegotiations on the 2009 gas deal Tymoshenko had signed.

Wondering why Putin didn't stand up for his 'protege' a little more? He generally found Yanukovych pretty hard to deal with, much preferred Tymoshenko.

9. What was the dollar to the hryvnia in 2010? Around 8. What was it before Euromaidan? Around 8.2.

What's it today, 4 months later? 10.55.

As Lyudmilla's husband might say, 'don't mention it'.

10. Yanukovych is the ultimate Ukraine success story. Born into dirt poverty in the Donetsk area his mother, a nurse, died when he was two, his father, a Polish-Belarusion locomotive engineer, had left the scene by the time Viktor was a teenager. Yanukovych has spoken of going barefoot, hungry, and having to fight to survive as a child.

He climbed his way from nothing, educated himself, got in a couple of scrapes along the way is true, but built a steady, respectable career in regional transport before his ascent to power - Prime Minister not once, twice, but three times. Elected president in 2010 - 49% to Tymoshenko's 45.5%.

So he liked a big house and some of the finer things in life. So he wasn't perfect, and he wasn't. But, as rallies are planned for Yanukovych in Donetsk this weekend, I say, Vik, you are 63, your time in power has probably passed. But you did a good job for Ukraine and, whatever they say, you deserve respect for that.return to Contents]
The Irish Times
March 21, 2014
If we have to pick a side over Crimea, let it be Russia
By Eamonn McCann
Eamonn McCann is a columnist with The Irish Times.

Vladimir Putin may run a vicious regime but the people of Crimea have a right to be accepted as Russian if that's what they want, which evidently they do.

Last Sunday's poll can be said to have fallen short of the shifting norms of democratic propriety, but none of the Western leaders who have been blustering about "making Putin pay" has challenged the reliability of the outcome as a measure of majority feeling in the region.

The people have spoken, perhaps in tones that fall harshly on Western ears, but making their wishes clear enough. Who is Barack Obama to tell them that their opinion don't count? If we have to take sides, we should take the democratic approach and side with the Crimean majority. That is to say that on this specific matter, Ireland should side with the Russians.

Manipulating fears

True, Russia has behaved provocatively throughout, manipulating fears, stoking tensions, manoeuvring for strategic advantage. Same as the West, same as ever. When it comes to double-talk, however, there is no contest. Putin is never going to be a match for Obama at talking out of both sides of his mouth at the same time.

After six years in office, Obama believes he has a right to invade anywhere, bomb anything, kill anybody whose jib the CIA doesn't like the cut of, irrespective of national or international law or, indeed, of the provisions of the US constitution. And now he lectures Putin on the necessity of "respecting international law". He has a nerve. I suppose it comes with the job.

Obama's interest in Crimea has to do with US strategy for curbing Russian power and influence. In the perspective of Washington - the same can be said of Moscow - democracy and human rights are marginal matters, if they figure in calculations at all.

One of Julian Assange's many gifts to democracy was a cable summarising a discussion in Paris in September 2009 involving Philip Gordon, assistant US secretary of state for EU and Eurasian affairs and a group of French diplomats, including Jean-David Levitte, French ambassador to the US from 2002 to 2007.

Under "Nato's Enlargement and Strategic Concept", Levitte declared president Nicolas Sarkozy's position was that Ukraine's destiny lay within Nato but that it would be unwise to push the case just then for fear of antagonising Russia - and because a majority of the Ukrainian people appeared to be against the idea.

Threat to sovereignty

A Nato summit in Bucharest in April the previous year had cleared the way for Romania, Croatia and Albania to join the alliance but postponed a vote on Georgia and Ukraine until December. In the interim, in August, Georgia and Russia went briefly to war over the status of South Ossetia. The December vote was shelved. Around the same time, a Gallup poll suggested that 40 per cent of all Ukrainians saw Nato as a threat to national sovereignty, against 17 per cent taking this view of Russia.

The context for these political manoeuvres had been set in the early 1990s by Nato-Soviet Union negotiations over Germany. German reunification in the wake of the demolition of the Berlin Wall required the withdrawal of the 400,000 Soviet troops stationed in East Germany under the terms of the treaty that had ended the second World War.

On February 9th, 1990, Soviet leader Mikhail Gorbachev, US secretary of state James Baker and German chancellor Helmut Kohl agreed that the Red Army would withdraw from Germany, in
return for which Nato troops would not move eastward - "even by an inch", pledged Baker.

Shortly afterwards, the Soviet Union began to implode and Nato forces swept across eastern Germany.

By 1995, Poland, Hungary and the Czech Republic were members of Nato. In 2004, seven former Soviet Republics joined. And then came Romania, Croatia and Albania in 2008.


It has virtually been ignored in the Western media that the EU offer of economic assistance to Ukraine last December included a condition that Kiev align its forces with Nato - a halfway-house staging post on the road to full Nato membership. It was this provision that deeply alarmed the Putin regime, which in turn sparked angry demonstrations in Kiev against the pro-Russian government of Viktor Yanukovich and its US-assisted replacement by a mixum-gatherum of groups, including anti-Semitic neo-fascists.

What emerges from this narrative is that neither Washington nor Moscow has had genuine concern for the interests of any section of the Ukrainian people but have been engaged in an exercise of self-interested Great Power politics.

Putin is right that the main motivation of the US and Nato has been to encircle and enfeeble his country. It might be a close run thing, but in this instance Russia has more right on its side than the West - which is the same thing as saying, more simply, that Putin and Russia are right.
[return to Contents] 
March 20, 2014
Congress of the Russian Union of Industrialists and Entrepreneurs

Vladimir Putin took part in the annual congress of the Russian Union of Industrialists and Entrepreneurs.

The topics on the congress' agenda include de-offshorisation of the economy, making business more transparent, enhancing labour productivity, improving labour legislation, and creating a better investment climate.

During the congress, representatives from the Agency for Strategic Initiative, Delovaya Rossiya (Business Russia), OPORA Russia, RSPP and Chamber of Commerce and Industry signed a cooperation agreement in the President's presence on organising and conducting a national rating of the investment climate in the Russian Federation constituent entities.
Excerpts from transcript of the RSPP Congress


First, I would like to thank you for inviting me to the congress of the Russian Union of Industrialists and Entrepreneurs.

The RSPP unites leading Russian companies that determine to a large degree the industrial and economic potential of Russia. You are responsible for thousands of employees and for large production facilities. You resolve major tasks and implement complicated projects.

I would also like to note the high authority of the RSPP as a leading business union and its impressive expert capabilities, which we in the Government and the Presidential Executive Office often turn to. We jointly discuss many issues pertaining not only to the economy, but also to social and other aspects of our nation's development.

You take an active part in drafting legal and regulatory acts, in implementing the national business initiative. Its most important element will be the investment climate rating to be compiled by the National Rating Committee, which will also feature representatives of RSPP.

We can see that you are interested in and support the efforts to promote integration on the post-Soviet space, and we view you as reliable partners. Actually, partners are what we really are.

Representatives of the Russian business community together with their colleagues from Kazakhstan and Belarus have been actively involved in the development of the Customs Union and the Common Economic Space, in resolving practical issues of customs administration, technical regulation and trade facilitation. This was a rather complicated joint effort and we are very grateful to the RSPP for its active involvement in this dialogue, which we will definitely continue within the framework of the Eurasian Economic Union that is now being created.

I would also like to mention the success of the RSPP as the chair of the Business 20. Global leaders were offered the most comprehensive package of proposals ever in the history of the G20, and most of these proposals became part of the final documents of the St Petersburg summit.


Our common goal is to ensure a new quality of our economy, to develop national industry. This is the driving force of long-term economic growth, scientific progress and resolution of social issues. This means new jobs, in other words - a chance for millions of our citizens to use their potential and have a decent income. This also means creating new centres of advanced growth and achieving the overall development of the regions on the huge expanses of our country.

Russia should be competitive in terms of all the key parameters of the business environment. Therefore, we will continue creating the most favourable conditions for investment, for the establishment of new production facilities and for training skilled personnel.

We will provide the necessary support to our companies, including in terms of entering global markets; we will defend their interests using the mechanisms of the WTO and other legal procedures. We proceed from the notion that the competitiveness of domestic business is the cornerstone of the nation's competitiveness in general.

However, as we have often discussed, entrepreneurs need to understand their responsibility. Our priority stance is that Russian companies have to be registered here, in their home country and have a transparent ownership structure. I am certain that this is in your interests too. This is why we set the task of de-offshoring the national economy and are drafting necessary amendments to the regulatory framework. I believe that we will return to this subject today both in this broad group and in more private discussions after this meeting.

There is one thing, however, that I would like to note. Our goal is not merely to limit the possibilities of using offshore schemes. We know that we will not get anywhere by simply banning things. Our efforts are mainly directed at making Russian jurisdiction more attractive, at improving business climate, strengthening legal guarantees of property protection, and improving the judiciary, including courts of arbitration. We will work on all these issues consistently and I expect to be working in close contact with you as well.

Naturally, once national companies start paying taxes in Russia, once they stop evading any responsibility for this country, this would lead to the growth of overall trust in business in general (I am sure you understand this too), trust in private property and values of economic and business freedom. This is key to the progressive development of our nation.

Thank you for your attention.

Regarding the new mechanisms for releasing employees. You know, I fully understand the logic, especially the logic related to the complicated situation in the economy, both global and domestic. Of course, the labour market has to show flexibility here. However, you also know what a sensitive area this is. Our labour legislation is already much more liberal than in most European countries. Look, for instance, at the labour legislation of the European Union, look at the labour legislation of specific countries, like Italy, for instance. Ours is much more liberal. Such issues need to be resolved primarily by a tripartite commission involving the trade unions, whose main task is to protect the vital interests of the employees. I am aware of the numerous discussions around working hours, and I know that in some industries employees, for instance miners, often ask for more freedom in this area. We have to be very careful here, maintaining a constant dialogue with representatives of the trade unions, directly with those, who represent the employees.

We will, of course, react positively to this. However, we always have to take into consideration the social aspects of this rather complicated issue, and we will do so. I would like you to understand me correctly.

Regarding the creation of the necessary business climate. We have done a lot in this regard, I believe, and what is important - there are results. We have done this together with the RSPP, with the ASI (Agency for Strategic Initiative) and with other business associations. I will repeat: there is progress, there are some positive results.

Naturally, a lot remains to be done. We will work together, because without your direct involvement, without feedback from you on the results of what is going on we cannot be efficient. We can only do this together. We are just as interested in achieving this as you are and we will work together. However, we expect this joint effort to continue.

Now regarding the issue of providing preferential treatment to our producers in the course of state purchasing, purchasing by state companies and so on. As you may know, back in the years of the sharp crisis of 2008, 2009-2010 I actively supported the idea of creating such preferences for our producers. Naturally, we need to introduce the rule that was mentioned here: even Western companies, foreign companies that come to our market have to be localised. This is true.

A procedure is already in effect whereby the price of our producers may be 15% higher and their bids still win at tenders or competitions. I would have made it even higher, but we have our beloved liberal economists (they are widely represented here, among you), and they say: where is the competition? Won't this influence quality? We need to bear in mind not only the producers, but also the consumers of goods, and this is right. I believe that rather than increase this price hike of 15%, we should think of what you yourself proposed, namely of localisation. We should only let those companies on our market that agree to such localisation. Although, here we could consider some other instruments as well that would help our local companies win the bidding for state procurement and procurement by our state monopolies, infrastructure monopolies. Overall, I believe this is the right approach. We only need to fine-tune our instruments to make sure we do not harm the consumers. We need to think about it.

As for the national rating of our regions' economic attractiveness, I hope we will continue this effort. I repeat, just as in our other efforts we can only make this work if we do it together.

Thank you very much.

March 21, 2014
Meeting with permanent members of the Security Council

Vladimir Putin held a meeting with the permanent members of the Security Council, during which a detailed discussion on the situation in Ukraine took place.

Taking part in the meeting were Prime Minister Dmitry Medvedev, Federation Council Speaker Valentina Matviyenko, State Duma Speaker Sergei Naryshkin, Chief of Staff of the Presidential Executive Office Sergei Ivanov, Secretary of the Security Council Nikolai Patrushev, Interior Minister Vladimir Kolokoltsev, Defence Minister Sergei Shoigu, Foreign Minister Sergei Lavrov, Director of the Federal Security Service Alexander Bortnikov, Director of the Foreign Intelligence Service Mikhail Fradkov, Deputy Secretary of the Security Council Rashid Nurgaliyev, and permanent member of the Security Council Boris Gryzlov.


Beginning of meeting with permanent members of the Security Council


We will discuss routine matters today, but we will also examine the biggest current issues too of course. Let's start with the situation regarding Ukraine and Crimea.

Mr Lavrov, what do you have to say on these matters? What can you tell us?

FOREIGN MINISTER SERGEI LAVROV: The situation is developing quite rapidly and our Western partners continue to propose unilateral action. Following the first wave of sanctions against individuals, taken several days ago, President Obama has now announced new sanctions against some 20 individuals and one financial institution - Rossiya Bank. There are rules that usually apply in diplomacy in such situations, and so we are currently drafting proposals for countermeasures.

VLADIMIR PUTIN: How many individuals are affected?


VLADIMIR PUTIN: We ought to keep our distance from them or they might compromise us. (Laughter)

As for the financial institution concerned, as far as I recall, this is a medium-sized bank. Personally, I did not have an account there, but I will definitely open one on Monday.

What other information do you have on this matter?

SERGEI LAVROV: Our Ukrainian neighbours continue to make contradictory statements regarding relations with Russia. In particular, they said that they are ceasing or suspending their participation in the Commonwealth of Independent States and plan to introduce visas for Russian citizens. If this does happen, we will brief you on our proposals.

VLADIMIR PUTIN: In both the first case, the US sanctions, and the second case, the Ukrainian proposal to introduce visas, I think that we should refrain from taking any countermeasures for now, especially as concerns visas for Ukraine, because if we introduce visas for Ukrainian citizens, millions of innocent Ukrainians would suffer, people who are not well off as it is and come to Russia to work and earn a bit of money here to support their families. We should not take such a step.

SERGEI LAVROV: If I may, regarding another aspect of the current international developments, our partners in NATO have suspended a number of cooperation activities within the Russia-NATO Council. This raises a practical question. We have one joint project - the helicopter project - which is jointly financed by Russia and Western countries and is a programme that will help the Afghans to repair Soviet- and Russian-made helicopters and train the needed people to repair, service and maintain this equipment.

The helicopter project's first stage has already been implemented quite successfully. Everyone agrees that it has helped to strengthen Afghanistan's capabilities for ensuring its own security. The time has come now to organise financing for the project's second stage, but given that our partners are now trying to freeze cooperation within the Russia-NATO Council, I wanted to ask your advice on what we should do in this situation.

VLADIMIR PUTIN: We should continue this cooperation even if our partners from NATO freeze our joint activities. I think that we all have an interest in seeing this project continue. We need to strengthen Afghanistan's government, and so I ask you not to halt any of this work and I ask the Government to go ahead with the required financing, which was provided for in the Russian budget.

As you know, UN Secretary General Ban Ki-moon raised the question yesterday of sending an OSCE mission and UN observers to Ukraine's eastern and southeastern regions, and I ask you to continue cooperation with our partners on this matter too and find a solution.

SERGEI LAVROV: We have nearly finished work on a draft resolution by the OSCE Standing Committee, and have ensured that OSCE observers will be sent not just to Ukraine's east and southeast but to central and western regions too, where many unpleasant incidents have taken place over the recent months.

Second, we have agreed on the number of observers and the regions where they will be sent. Any changes to these agreements, such as an increase in the number of observers or the regions, would be decided by the OSCE Standing Committee. We will follow your instructions here.


I have a question for Mr Shoigu on the situation with Ukrainian military bases in Crimea.

DEFENCE MINISTER SERGEI SHOIGU: As things stood yesterday, 72 units had decided in their entirety to join the Russian Armed Forces. The commanders and officers raised the Russian flag themselves at these garrisons. We are now taking care of the formalities regarding the servicemen and officers serving in these units, settling the citizenship issue and acting in accordance with the decision you signed yesterday on recognising officers' rank and educational qualifications.

The second aspect in this work is that this is taking place on a totally voluntary basis. In terms of the future possibilities for military servicemen in Crimea, we see three options. First, if people there want to serve in the Russian armed forces, we will of course offer them a place. If they do not want to serve in our armed forces but wish to remain in Crimea, this is also possible. Third, if people want to continue their service in Ukraine's armed forces, they will have this possibility too and will be free to leave Crimea and continue serving elsewhere, in the Ukraine army's units.

We have already encountered such cases. The coast guard commanders, for example, said that they wish to continue their service in the Ukrainian army and will leave Crimea. We are organising transport for their families and property so that they can depart for Ukraine without problem.

I particularly note the executive order you signed yesterday about reopening the Black Sea Fleet Higher Naval School. Everyone there, including the students, swore the oath yesterday and it will continue work now as the Nakhimov Higher Naval Academy.

I also want to note one other significant fact, namely, that we are offering Ukrainian military personnel studying there the opportunity to continue their studies at the academy and obtain their diploma, after which they can choose which direction to take next.


Mr Shoigu, I ask you to ensure a friendly and respectful attitude to everyone, no matter what their decision, and respectful treatment too of Ukraine's state and military emblems.

Does anyone have anything else to add?

PRIME MINISTER DMITRY MEDVEDEV: Yes, there is one matter that I want to raise. It takes us back a few years.

I remind you that when I was President, I signed the Kharkov Agreement with President Yanukovych. Under the terms of this agreement, we extended our use of the naval base [in Sevastopol] for a long period - 25 years. At the same time, under this agreement, Ukraine gained financially under a deal that exempted it from compulsory payments that would otherwise have been made to the Russian budget. What's more, we started applying the new agreement's terms immediately, even though our use of the base was still covered for quite a long period by the old agreement. This enabled Ukraine to save around $11 billion, and the loss to Russia's budget thus also comes to around $11 billion.

The point I want to make is that now that the circumstances have changed and Crimea is now part of the Russian Federation, there are no grounds for keeping this agreement in effect. There is a principle in international law, in accordance with which an agreement remains in force only so long as the circumstances that gave rise to it prevail - clausula rebus sic stantibus - excuse me for the Latin.

VLADIMIR PUTIN: That's all rather clever sounding, but it does make a substantial point.

DMITRY MEDVEDEV: Yes, it sounds rather weighty, but what we have before us is precisely this kind of case. If this is so, then we should revoke the agreement in accordance with the set procedure. But this raises the matter of the $11 billion that our budget has lost. I think it is perfectly fair to raise the question of having Ukraine's budget compensate these funds. This could be done through the courts, in accordance with the revoked agreement's terms. Of course, these are tough measures, but at the same time, the agreement no longer has effect, but the money we paid is real, and our Ukrainian partners must understand that nobody hands over money just like that, for nothing.

At the same time, I remind you that Ukraine's debt, public and corporate, to Russia is quite large as it is. This includes the $3-billion loan that we gave them recently in accordance with our agreement to buy Eurobonds, and the nearly $2 billion that Ukraine owes in accumulated debt to Gazprom. All in all then, Ukraine's total debt comes to a very large sum.

VLADIMIR PUTIN: 11 billion plus 5 billion?

DMITRY MEDVEDEV: Yes, it comes to all of $16 billion. I don't think we can afford to lose that kind of money given that our budget faces difficulties of its own. I propose that we examine these issues in accordance with the set procedures.

VLADIMIR PUTIN: Mr Medvedev, remind me of the situation please. The way things turned out, we gave Ukraine a discount on energy resources immediately after signing the agreement, that is, starting in 2010, but we acted in advance so to speak, because the use of the naval base was still covered by the old agreement until 2017. In other words, we gave Ukraine this money in advance.

DMITRY MEDVEDEV: Yes, that is the situation, Mr President. This was essentially an advance payment taking into account our particular agreements at that moment. In principle, we could have chosen not to pay this money, but we did so, given that this was part of the new agreement's terms, and it was also a way of helping Ukraine. But now that the circumstances have changed, this advance payment should be returned.

VLADIMIR PUTIN: Yes, there are grounds for this. Let's not take any hasty steps though. Let's discuss the whole matter and analyse it. I ask the Foreign Ministry to join in this work too and then present proposals together with the Government.
March 23, 2014
President Putin mocks US sanctions, vows not to retaliate

Bladimir Putin has mocked US sanctions imposed on Russia, saying he will open an account at US-sanctioned Rossiya Bank. During a meeting with the country's senior security officials he added that he won't introduce a visa regime with Ukraine.

Putin treated with irony the recent sanctions imposed on certain Russian lawmakers.

"Yes, these are those so-called 'polite people in camouflage with guns'," ironically said Putin hinting at Western accusations that Russian soldiers have taken bases in Crimea.

"Look at them, typical Moskals [pejorative term for Russians - ED.]," he added, pointing at US sanctioned prominent businessmen Arkady and Boris Rotenberg, Gennady Timchenko, head of the Volga Group and Yury Kovalchuk, the owner of Rossiya Bank. "I need to avoid these citizens as they are 'compromising the country'."

On Thursday the US expanded its sanctions list by adding 20 more names. US President Barack Obama announced a new executive order imposing further sanctions on top Russian officials and businessmen.

Aleksey Gromov, First Deputy Head of the Presidential Administration; Sergey Ivanov, Chief of Staff of the Presidential Executive Office; and Sergey Naryshkin, Speaker of the State Duma, the lower chamber of the Russian Parliament, are among those mentioned. Russian Railways President Vladimir Yakunin is also on the list.

The order also allows for measures against Russian energy, mining, defense, and engineering sectors.

Putin also commented on the latest sanction of the US authorities that concerned Russia's Rossiya Bank, to which international payment systems Visa and MasterCard stopped serving clients on Friday.

The Russian president said he will get his salary via the sanctioned bank.

"I've already said that I was going to open an account in this bank, more than that I asked for my salary to be transferred to this account," he said.

Putin added that Russian authorities should provide any possible support for the clients of the blocked Rossiya Bank, as this "finance establishment has nothing to do with Ukraine crisis."

"The clients of the bank must be taken under our protection. We also should make sure that neither clients nor the bank will sustain any negative outcome from this situation," he added.

Putin assured that Russia will refrain from retaliatory sanctions against the US and introducing a visa regime with Ukraine.

Putin believes that millions of innocent Ukrainian would suffer should Russia introduce a visa regime with Ukraine.

"These people are not rich. They work in Russia to provide for their families. We shouldn't do this," he added.

Putin also said Russia will continue leading a project to repair helicopters in Afghanistan, which is run by NATO and Russia.

"We should continue this cooperation despite our NATO partners vow to freeze our partnership," he said.

The so-called helicopter project, financed by both Russia and Western countries, aims at helping Afghanistan repair helicopter equipment produced in Russia and training special personnel to operate this equipment.

Putin's statement about the visa regime came after reports this week that Ukraine might introduce a visa regime for Russians, but Ukraine's coup-appointed PM, Arseny Yatsenuk, said the authorities are in no hurry to impose it.

Moscow restaurants impose "entry ban" on Obama

MOSCOW. March 22 (Interfax) - Moscow restaurants are introducing sanctions against U.S. President Barack Obama.

Notices saying an "entry ban" has been imposed on Obama have been put up at the entrances to Dolma restaurants in central Moscow, an Interfax correspondent reported.

The manager of a Dolma restaurant, Lasha Churgulia, said that, "the ban only applies to Obama for now." "Whether or not the list will be extended depends on the United States' and on the European Union's further moves," he added

News about restaurants' "sanctions" earlier arrived from other Russian cities.

Russians support Crimean accession to Russia - poll

MOSCOW. March 24 (Interfax) - An overwhelming majority of Russians (93%) support Crimea's accession to Russia and only 4% have a negative opinion, the Russian Public Opinion Study Center (VTsIOM) said.

In the opinion of 89% of Russians, Crimea means Russia.

Some 65% of people who share this opinion say that Crimea is a historically Russian land, which had been a part of Russia until 1954 when Soviet leader Nikita Khrushchev attached it to Ukraine.

Another 22% say most of the Crimean population is Russian.

Only 7% say that, in fact, Crimea is not Russia, the sociologists said.

VTsIOM polled 1,600 adults in 130 populated areas in 42 districts on March 15-16. The error is less than 3.4%.

Some 96.77% of Crimean voters chose to join the Russian Federation on March 16, 2014. The voter turnout stood at 83.1%.

Two questions were put on the Crimean referendum: 1. Do you support Crimea's reunification with Russia as a constituent territory? (yes or no) and 2. Do you support the reinstatement of the 1992 constitution of the Republic of Crimea and Crimea's status as a part of Ukraine? (yes or no).

After the referendum the Crimean Supreme Council declared the autonomous region a sovereign state, the Republic of Crimea, and requested Russia to admit the republic as its constituent part. The Sevastopol City Council unanimously voted to join Russia as a separate constituent part of the Federation at its special session.

Russian President Vladimir Putin signed a decree on March 17 to recognize the Republic of Crimea as a sovereign and independent state. A treaty between the Russian Federation and the Republic of Crimea was signed in Moscow on the next day to declare the admission of Crimea to the Russian Federation and the establishment of two new constituent territories within the Russian Federation.
Al Jazeera
March 21, 2014
Crimea: Whose land is this? Part 1
In order to understand the conflict in Crimea, one has to know the history of the peninsula.
By Sergei Khrushchev
Sergei Khrushchev is a Senior Fellow at the Watson Institute for International Studies at Brown University.

On March 16, the Crimean referendum took place without any fighting or clashes, which Kiev and Washington were hoping to use to discredit the process.

As a result, the referendum was conducted without major problems; 83 percent of the population cast their vote and 96.7 percent of them - Russians, Ukrainians and even some Tatars - voted for secession from Ukraine and annexation to Russia. The vote was observed by 135 representatives of 23 countries and 240 observers represented the Crimean civic society and political parties.

They unanimously confirmed that there were no significant violations and that everyone could vote freely, without any pressure.

All night, people on the squares of the Crimean capital Simferopol and others were celebrating, laughing, hugging, dancing, and firing fireworks. In Kiev, all were sulking.

In Washington DC, the best minds of the Obama administration were feverishly thinking how else to make it more difficult for the recalcitrant citizens of Crimea. They will definitely think of something since they have a lot of experience in doing so. After all, Iraqis, Iranians, Syrians, Libyans and the Lebanese have long stopped celebrating.

Illusionary connections

Crimean's main goal was to break up the illusionary connections with Ukraine. Crimea's divorce from Ukraine was bumpy: In the last 20 years, there were constant tensions and it ended with a scandal, which gradually involved a number of countries. Some took Ukraine's side, others did not. Who is right, and who is not, it is difficult to say.

However, as a result of this scandal, Crimea and Ukraine have become household conversation and yet few people know what the matter was really about.

That is why, I will begin with history. Crimea is a peninsula on the north coast of the Black Sea, connected to the European continent through a narrow strip of land. Some 2,500 years ago, the ancient Greeks founded a colony there, including in the western part of the peninsula, where they built the port Chersonesus, which is the present location of Sevastopol.

Remember this name, we will get back to it later. Then the Romans took over from the Greeks and after them the peninsula was uninhabited for some time.

In the meantime, in 854 the Vikings set up an outpost on the river banks of Dnepr, which crosses the European continent from North to South. They thought it would be easier to use the river to get to the riches of Byzantium than to go around Europe in the stormy seas.

They gradually subordinated the local tribes and this is how the ancient kingdom of Kievan Rus was born. It gradually expanded its rule and reached Crimea. However, everything collapsed overnight in 1240, when the Mongols captured Kiev and turned it into ruins for many decades.

These lands on the banks of the Dnepr river were orphaned, while the Genovese settled in Crimea. After a century, the newly rebuilt Kiev came under the rule of the rising power of the Polish-Lithuanian Commonwealth. This continued until the 15th century. During this time, in the North-East, the state of Moscow emerged which incorporated the leftovers of the Mongol Empire.

In Crimea, Tatars invaded in 1428 displacing the Genovese and settled there permanently. But who are the Tatars? This is one of the inheritances of the Mongol expansion. Genghis Khan preferred not to risk his own Mongol soldiers and therefore, on the front lines, he would put men from the conquered peoples.

One of the first people he conquered were the Tatars. Since then, he dragged them into battle around the world. After the break-up of the empire, some Tatars returned to their homeland, while others stayed where they found themselves: On the Volga river - The Astrakhans and Kazan Tatars; and in Crimea - the Crimean Tatars.

The Crimean Tatars were closely cooperating with the Ottoman Empire and fought Russia and Poland, which at that time were controlling the territory of today's Ukraine.

In the meantime, fugitive Russian and Polish serfs settled on the island of Hortitsa in the river Dnepr, and started calling themselves Cossacks. They provided for themselves through plundering, attacking at times the Tatars, at times the Poles. Gradually their power increased and the Cossacks became a serious organised force, always in conflict with Poland.

Two Ukraines?

In the second quarter of the 17th century, the Cossacks, under the leadership of Bogdan Khmelnytsky, once again attacked Poland. Towards the end of the campaign, they suffered a defeat. Khmelnytsky found a way out of the dead-end: In 1654, he signed a treaty with the Russian tsar putting East Ukraine under the protection of Moscow.

The Western part of Ukraine was left to the Poles which then came under Austria-Hungary and then again to the Poles. As a result, the Ukrainian people were split between two branches: Eastern and Western.

Independently from Russia, but not from the Ottoman Empire, the Crimean khanate existed until 1783, when it was conquered by the army of Russian Empress Catharine II, who set up a port at the old location of Chersonesus to host the Russian Black Sea fleet.

The new port was called Sevastopol. Since that time, Ukraine and Crimea were part of the unified Russian Empire. Crimea, with its warm climate and pebble beaches, was a favourite holiday-destination for all Russians, whether Tsars, aristocrats, and even simple people, if they had the means.

It continued this way until World War I or rather 1917 specifically, when the revolution was destroying the old regime and taking down its laws. And when everything was possible. The periphery took advantage of that, including Ukraine, which declared independence.

On the map of Europe, there were in fact two Ukraines: An Eastern one with capital Kiev and a western one - on the territory reclaimed from Austria-Hungary during the war. But already in March 1918 all changed. The Bolsheviks signed a peace treaty with Germany, through which Ukraine was conceded.

It is impossible to occupy a territory, which doesn't have borders. The German generals drew in their own understanding the borders of Ukraine, including Crimea. They ushered in their army, killed Ukrainian independence in its cradle and were preparing to settle for a long time.

However, in November 1918 Germany suffered a defeat from the Entente and its army was forced to leave Ukraine. Ukraine then became a Soviet Republic and it took part in the founding of the Soviet Union, but without Crimea, which joined the Russian Federation.

After World War II, Ukraine acquired the Western lands and it acquired its present borders. On the river Dnepr, the construction of hydroelectric plants began, one after the other. In 1950, the works reached the lower part of the river. It was decided that the last cascade of the Kakhovka Hydropower Plant will be used not so much for electricity, but for irrigation of the dry lands of Southern Ukraine and Crimea.

At the end of 1953, when the five-year plan for 1955-1960 was being prepared, two irrigation canals included: South-Ukrainian and North-Crimean.

The first canal was going through Ukrainian territory in its entirety, while the second one began in Ukraine and ended in the Russian Federation, in Crimea. The planners decided that this will necessitate the splitting of construction authority, which will cause confusion in the building process and slow it down. So they came up with a suggestion to the government:

Since the canal passes mostly through Ukrainian territory, then the rest of it should, along with the whole of Crimea, pass from the supervision of Moscow to that of Kiev.

My father Nikita Khrushchev who headed the leadership of the Soviet Union, agreed with this argument, especially that an anniversary was approaching:

In February 1954, it was 300 years since Ukraine joined Russia. It was said - it was done. The Higher Council of the Russian Federation decided to pass Crimea over to Ukraine. In this way, Crimea came under the jurisdiction of Kiev, but just formally. In fact, it remained part of the Soviet Union and was our common holiday destination.

The end of the Soviet Union?

And now how did it end? By the end of 1991 in the Soviet Union there was a revolutionary atmosphere. The Soviet republics, including Ukraine, started talking about independence. They weren't just talking about it, in fact they decided to act, even if it were against the constitution. Three presidents got together in the Bialowieza Forest: Boris Yeltsin (Russia), Leonid Kravchuk (Ukraine) and Stanislav Shushkevich (Belarus). They agreed on the fact that the then president of the Soviet Union, Michail Gorbachev was wearing them down and they needed to get rid of him and the Soviet Union.

Before the signing of the document, they decided to get lunch. But as Leonid Kravchuk said in an interview, one thought worried him: What to do with Crimea? Formally, it was part of Ukraine, but in reality? He turned with this question to Yeltsin, but at that moment he was not in the mood to deal with this matter. He couldn't wait to get Gorbachev out of the Kremlin.

He was sitting down and rushing through his drinks and there was Kravchuk still pestering about Crimea. Yeltsin waved him off to go away. Kravchuk calmed down and took off with Crimea, which became an autonomous zone within the borders of independent Ukraine. The peninsula, however, never completely entered Ukraine and it felt as an outcast in the new state.

It could have continued like this forever, but then the "Maidan" revolution happened. At the end of 2013, Western Ukrainians, dissatisfied with President Viktor Yanukovych, gathered at Kiev's Maidan and overthrew the hated authority of the Eastern Ukrainians.

The president escaped, while they bypassed the constitution and established their power. Crimea took advantage of these circumstances, because since such unconstitutional takeover could happen in Kiev, why not have it happen in Crimea too? Thus they announced a referendum for secession from Ukraine.

According to the constitution, it is illegal, but according to the constitution, the current government in Kiev is also unconstitutional.

In reality, however, everyone accepted it, even the US president. So what makes the Crimeans worse than them? The Crimean referendum, too, in reality won't have less power/strengthen than the government in Kiev.

Al Jazeera
March 22, 2014
Crimea: Whose land is this? Part 2
Is it fair for the US to expect unconditional obedience from Russia against its own national interests?
By Sergei Khrushchev
Sergei Khrushchev is a Senior Fellow at the Watson Institute for International Studies at Brown University.

Crimea is by far not the first entity - and won't be the last - to achieve independence in this way. In the past, the US broke off the British Empire, while Kosovo just recently left the borders of Serbia. It is in this manner that many achieved their independence, whether Abkhazia, Algeria, Nagorno-Karabakh, East Timor, South Ossetia, Czechoslovakia (which split into the Czech Republic and Slovakia), and maybe soon Scotland (due to hold its own independence referendum).

In 1991, in spite of the Soviet constitution, Ukraine itself acquired its independence. The list goes on and it is a natural process within the dynamic development of the world, when some announce independence and others lose their colonial territories and subordinate lands. It is a painful process, but we've gotten used to it. As the international scandal around Crimea erupted, it sucked into its orbit countries which until 2014 knew almost nothing about the peninsula.

Illusory theories

And this was all because the US decided it was so, taking up homegrown illusory theories without considering international realities. For example, at some point in the US, the domino theory was popular, according to which, if they let go of just one country from their orbit of influence, then the whole world would instantly fall apart. This theory turned out to be not even a theory, but a fantasy, and yet, because of it, the US and the world lost countless lives.

Now in the US, there's another fantasy: If they let any of the former Soviet states get closer to Russia, then the Soviet Union will be reconstituted, marking a return to Cold War. The fact that such a scenario is impossible, after 25 years of independence for these countries, is not taken into account. For Americans, fantasy seems stronger than reality.

And of course, one can see the US attempts to demonstrate that today's world is the American world: Washington decides on everything - who to judge worthy or unworthy. This is how it was once in Pax Romana. Until, of course, Rome fell.

And thus the US is dictating its will, which tends to be a product of domestic interests and reflects internal struggles between its political forces. It imposes its will  on the rest of the world and does not back down from its stance, not an inch, even if this position is completely flawed.

One more component: President Barack Obama is somehow believed to be a weak president, which gives the impression that anything that happens in the world involves the US. I don't know whether or not Obama is a weak politician. Personally, I find him likeable, but a politician's strength or weakness is a very serious factor in world politics.

A strong politician and leader need prove, neither to himself nor to his circle, that which is obvious to everyone. He feels free and participates in negotiations with his opponents, trying to explain his position and understand his partners; he is always ready to make a reasonable compromise and in the end makes decisions even in impossible situations. An example of that is how President John F Kennedy and the head of the council of ministers, Nikita Khrushchev, both strong politicians, behaved during the Cuban crisis and found a solution under mutually acceptable conditions.

A weak politician always tries to prove to his circle and to himself that he is not what others think of him; he has to prove his strength which, in reality, turns out to be obstinacy rather than strength. After making a statement, he would not change his position at all, or else he would appear weak, and at the same time avoid negotiations in person because he fears them.

Instead, he sends emissaries with rigid, uncompromising instructions, draws red lines, resorts to threats and sanctions, and demands capitulations from his partner, i.e. useless and counter-productive negotiations. No self-respecting country would agree to capitulation.

As a result, the weak politician tends to quickly draw the situation into a conflict rather than a solution. And all this is to prove his power - to himself and others - and because of that he is ready to sacrifice countless lives.

He is ready to impose sanctions, which will lead to the suffering of millions of people, which will hurt not only the partner-opponent, but also his own country. That is why, the sanctions will not only hit the enemy, but also deprive the US from millions of potential customers. And all this to prove one thing - that he is not weak.

Lesson from history

I repeat, I don't know whether Obama is weak as a politician, but it is precisely this sort of "uncompromising" situation that is being set up around Crimea. The US president made effort to put together a coalition which does not recognise the will of the people. And all this against the principle which was declared by his own predecessors.

Let's remember Woodrow Wilson, who declared the right of every nation to self-determination and statehood. Or President Clinton, who was not reluctant to use military force to try and convince Slobodan Milosevic of the right of Kosovo's Albanians to establish a state.

Now everything is happening in the opposite direction. Crimeans are threatened by sanctions and by the direct enforcement of Kiev's power onto them. And for expressing support for Crimea, Russia is also threatened with sanctions. Will such policies work? I doubt it. It would rather have the opposite effect: It will stimulate the struggle for independence inside Crimea and it will encourage Russia to assume an even firmer position of support for this movement. Let's remember how in the 19th century, Russia held firmly its support for the liberation movement of the Bulgarians from Turkish rule.

As for the sanctions, they of course are painful, but the use of such pressure is insulting to the national self-consciousness and will only provoke the Russians to undertake even more intransigent resistance. This has happened more than once in history.

During the 1853-1855 war, Sevastopol survived a long siege by the combined forces of the English, French and Turks, while in 1941-1942 it resisted the German army for almost a year. Should I also mention the 900-day siege of Leningrad? Then, too, those leading the siege were driven by the logic that capitulation is inevitable, but the besieged decided the opposite and in the end, they won. And now these sanctions...

Financial rewards for all?

But in all this unpleasant story, there is also a positive aspect: The stormy clouds of Crimea poured a golden shower over Ukraine. It received from the West more financial help than it ever dreamed of. It's another question whether the new government will be able to use it reasonably. Or will they put it into their own pockets?

The White House did not waste time and it officially recognised the self-formed revolutionary government of the Maidan and Obama even welcomed its prime minister and showered him with kindness.

Crimea got lucky, too. Due to lack of investment in the past 20 years, its infrastructure has become dilapidated. Now it's Russia's honour to rebuild Crimea.

The Tatars got lucky, too. The Russian Parliament promised them maximum political, cultural and other privileges, which they requested from Kiev before, but to no avail. Of course, Tatar autonomy in Crimea is impossible; they are only 12 percent, but an adequate presence in all governmental institutions is guaranteed for them, as well as legalisation of the lands, which they took over illegally and continue to live on without any rights or guarantees.

And as for the accusations and insults thrown at President Vladimir Putin, let's think about them. Twenty-five years ago, his predecessor Mikhail Gorbachev turned his face westward, declared his adherence to Western values and friendship with the US. Boris Yeltsin followed the same policies, and even Putin in his early years did so.

The US did not abide by any of its promises to Russia, neither the written ones, nor the spoken ones. They promised that NATO would not enter Eastern Europe, and what is the reality today? Russia supported the US war on Iraq and even the intervention in Libya aiming at regime change. As a result, Russian companies have been squeezed out of the markets of these countries.

>From Russia, they expect unconditional obedience, without any attempt to defend Russian national interests. And on top of that, it's threatened by sanctions. It seems that they perceived the friendship between Russia and the US to mean that Russia would remain a small nation in the American orbit . Maybe Putin simply got tired of doing that?
Sanctions bind Russia together, for now
By Elizabeth Piper

MOSCOW, March 23 (Reuters) - Far from dividing Vladimir Putin's inner circle, U.S. sanctions are drawing them ever closer together behind the former KGB spy and his drive to create a Great Russia.

Revelling in the triumph of Russia reclaiming lost lands, many in the political and business elite seem willing to make sacrifices to give full rein to an "imperialist consciousness" and a nationalism that has long lain dormant.

But once the euphoria fades, the hardcore group may find their business allies less willing to help win over a population facing economic decline, and may face a stark decision - resort to repression or embark on another campaign to rally the troops.

As Putin deadpanned at a meeting of his security council that he would have to steer clear of those on a U.S. sanctions blacklist, many of the targeted officials and businessmen said they would wear their punishment as a badge of pride.

"It is clear they strike at those who have some worth," said Russian Railways boss Vladimir Yakunin, one of 20 officials and businessmen to be hit by visa bans and asset freezes in a second round of sanctions imposed by Washington.

"On the one hand I am in good company. I cannot hide that I felt flattered. All the people on the list are notable people, people who have done a lot for Russia," he wrote in his blog, adding he also could not understand the West's "irrationality".

His words chimed with a chorus of mockery and derision from the dozens of Russians the United States and European Union have penalised over Russia's annexation of Ukraine's Crimea region.

The bravado runs deep, tapping a well of anger over years of perceived slights and hypocrisy by Western nations happy to invade nations to protect human rights and democracy and blind to the strategic interests of others.


Olga Kryshtanovskaya, an expert on the Russian elite, said while the United States saw its mission as spreading goodwill, Russia had its own mission - "for the ideology of Great Russia".

"And for that, our politicians, like yours, are ready to sacrifice a lot, our mission means so much to us," said Kryshtanovskaya, who mixes closely with the political elite despite leaving Putin's ruling United Russia party in 2012.

After the chaos of the 1990s following the Soviet Union's collapse, taking with it the country's superpower status, Putin has tried to restore some of the country's might, benefiting from high oil prices to give Russia economic clout.

But with slowing growth exposing an overwhelming dependency on energy, Putin has, by design or just driven by the momentum of events, pursued an increasingly conservative take, regularly using a dissolute West as a comparison to a moral Russia.

Kryshtanovskaya said the nationalism had wide support.

"Now there is unity. Ordinary people who really weren't that bothered about Crimea before are now supporting it, supporting the feeling of strength, the feeling that Russia is driving things, Russia is governing, that Russia is feared, that Russia is respected, that we are changing the agenda."

Not being on board could be seen as treacherous.

One member of the elite close to the Kremlin said that if he was subjected to a visa ban to the United States, he would readily sacrifice seeing his son studying there.

"He can always come back," he said.

The business elite has potentially much more to lose.

Gennady Timchenko, a longtime acquaintance of the Russian leader, sold his stake in the world's No. 4 oil trading company Gunvor a day before his name was added to the sanctions list.

For others with companies registered abroad at arm's length from the Kremlin, the patriotic fervour has also become uncomfortable. Putin told company bosses on Thursday to bring their assets home to help Russia survive any future sanctions and the economic downturn.


Some foreign officials suggest business leaders were not consulted over the hawkish turn of the past month; the result, they say, of pressure on Putin from hardline conservatives not to appear weak.

"Putin is acting together with a very small circle, all of them former KGB agents," said a senior German security source, suggesting they were dissatisfied with Putin's handling of the Ukraine crisis and his gamble on President Viktor Yanukovich, who was deposed last month.

"Within this group, Putin is under pressure - because he was unable to prevent Ukraine drifting west and because he bet on a weak Yanukovich, who should have crushed the Maidan protests immediately."

But no one doubts he is the ultimate arbiter, and at the security council meeting he offered no suggestion that he was regretting going head-to-head with the West over Ukraine.

Instead he wryly told his officials he would open a bank account with St Petersburg's sanctions-hit Bank Rossiya, which is chaired and partly-owned by media baron Yuri Kovalchuk, who Putin has known since the early 1990s.

"I will transfer my wages there," he said.

It is the kind of posture that has buoyed his popularity ratings, and cemented support among the elite. But some wonder how long the party can last.

"Such events create 'the champagne effect' - a rapid, but short-lived high. Depending on the dose, either the foam settles or you get a hangover," said Alexander Rubtsov at the Institute of Philosophy at the Russian Academy of Sciences.

"There are two simple ways out of it: either tighten the screws and so be ready to crush mass protests with repression or arrange new conquests."

Christian Science Monitor
March 21, 2014
Why US sanctions could play into Putin's hand
The post-Crimea sanctions are meant to squeeze top Russian officials and businessmen. But will the measures just push them closer to the Kremlin?
By Fred Weir, Correspondent

Moscow - The new round of US sanctions slapped on Russia over Crimea Thursday may already be taking a toll on Russia's economy. But how effective the measures will be in curbing Russia's aggressive policies remains a controversial question.

In fact, the Kremlin leadership could have planned for the sanctions in a way that would mute their immediate impact on their intended targets, Russian President Vladimir Putin and his closest associates.

The true effects of the measures, as they percolate through the Kremlin-centric financial and business circles, will sting with growing force in the long term. Yet in the short term, they might play into Putin's hand as he continues to centralize power at home.

Russia's stock market plunged by around 3 percent Friday, after slumping 10 percent in the past month. The beleaguered ruble rallied slightly, but projections show it continuing its recent dramatic downward slide.

The rating agency Standard & Poor's downgraded Russia's credit outlook to negative, citing "heightened geopolitical risk." And the US-based companies Visa and Mastercard stopped processing payments for cardholders of at least four major Russian banks, a move that could hit ordinary Russian consumers.

"Society is very nervous. Ruble depreciation and the suspension of Visa card services is going to hit a lot of Russians hard," says Alexei Vedev, a senior economist at the Gaidar Institute in Moscow. "There is no doubt that these political tensions, and the sanctions, have brought a lot of uncertainty that will seriously worsen Russia's economic position."

About two dozen top Russian officials involved with Crimea face visa bans and asset freezes. These restrictions are largely symbolic, and some targeted individuals are reveling publicly in their new status as bêtes noires of the US.

For one, Deputy Prime Minister Dmitry Rogozin has kept up a steady stream of defiance on Twitter, writing, among other things, "All these sanctions aren't worth a grain of sand of the Crimean land that returned to Russia."

Whether a coincidence or not, a sanction strategy nearly identical to the one pursued by the US was suggested in this week's New York Times op-ed by Russian anti-corruption crusader Alexei Navalny, currently under house arrest in Moscow. Mr. Navalny argued that instead of hurting average Russians, "Western nations could deliver a serious blow to the luxurious lifestyles enjoyed by the Kremlin's cronies who shuttle between Russia and the West. This means freezing the oligarchs' financial assets and seizing their property."

Mr. Navalny's list of inner-Kremlin tycoons to be sanctioned tracks very closely with those subsequently called out by the US.
Unintended side-effects

But there are serious doubts among some experts over what seems to be the main prong of the US strategy: to hit members of President Vladimir Putin's inner circle with targeted measures.

In fact, the US may be providing a boost to the Kremlin's tactic to centralize power. Since returning to the presidency for the third term, Putin has pressured Russia's rich oligarchs to bring their money home and divest themselves of foreign property - a message he pounded again this Thursday in a room full of leading Russian businessmen. Laws passed last year restricted Russian officials from having bank accounts or real estate abroad, and now their implementation will be strengthened.

"I think Putin can actually benefit from these sanctions," says Nikolai Petrov, a professor at Moscow's Higher School of Economics.

"He has designed a kind of 'besieged fortress' model for Russia, and he realizes it's necessary to compel the elite to bring their assets home. Their loyalty can only be assured if they have no escape hatches, such as bank accounts and property in the West. Until now they have found all kinds of ways to avoid doing that, but if the West itself now drives them back to Russia, they will have no choice," Mr. Petrov says.

The key targets of Thursday's sanctions, according to a Treasury Department statement, are a leading Russian bank and four wealthy associates of Putin, whose vast business empires may be linked to his own fortune.

They include Gennady Timchenko, Russia's 12th richest man and the founder of the Swiss-based commodity trading company Gunvor. "Putin has investments in Gunvor and may have access to Gunvor funds," the statement said.

But news reports suggest that Mr. Timchenko may have already dodged the sanctions bullet by selling his 43-percent stake in Gunvor to his business partner, Swedish tycoon Torbjorn Törnqvist.

Also listed are the Rotenburg brothers, Arkady and Boris, former judo sparring partners of Putin who have amassed enormous fortunes in state contracts, many of them in Sochi.

Yury Kovalchuk, main owner of the US-sanctioned Bank Rossiya, is a Russian media magnate who has been described as "Putin's banker."

Putin shot back by announcing that he would immediately open an account at Bank Rossiya and pledging that its other customers will be protected.

What about Russia's top dog?

One key issue - which could make or break the sanctions' effectiveness - is whether Putin himself actually holds a vast personal fortune in foreign assets that might be targeted.

The scant evidence for Putin's private wealth always comes back to statements made by a leading Kremlin-connected analyst, Stanislav Belkovsky, to Die Welt and The Guardian, in which he estimated Putin's accumulated fortune to be about $40 billion, including huge personal stakes in several state corporations.

But many experts argue that Putin already enjoys perks that would be the envy of any czar and thus has no need for cash stashed abroad.

And even Mr. Belkovsky, reached by the Monitor by phone, no longer sounded so sure. He said he was preparing to leave the country and couldn't talk. But "the only thing that I can say is that I assume that there is no division, nothing formal, between Putin's own property and finances and the property of his inner circle."

In other words, the link, if it exists, will prove a difficult target to hit.

"Russian oligarchs are unlikely to suffer much, because they have long since insulated themselves," says Igor Kovalyov, deputy dean at the Higher School of Economics in Moscow.

Most big companies have joint capital, making it difficult to injure Russian wheeler-dealers without hurting their foreign partners, he adds: "I think these sanctions will turn out to be mainly symbolic."

Meanwhile Putin, whose popularity rating is spiking, may be reaping big political rewards, says Olga Kryshtanovskaya, a leading expert on the Kremlin elite.

"I have never seen a time when the Russian elite and public were so united as they are now," in the wake of Crimea's takeover, she says.

March 24, 2014
Russia may counter sanctions threat with foreign real estate ban for officials

A ruling party MP is suggesting to fast track a bill banning leading Russian politicians owning foreign real estate, claiming such a move would make the country less vulnerable to outside pressure and threats of sanctions.

Yevgeniy Fyodorov of the United Russia parliamentary caucus has asked the Lower House Committee for Security and Countering Corruption to speed up work on an amendment to an earlier bill forbidding top level Russian officials, both elected and appointed, to hold foreign bank accounts and possess shares in foreign companies.

"The new amendment has been drafted in order to rule out the possibilities of them being directly mentioned in foreign laws. The well-known Magnitsky Act puts it straight -Russian civil servants who do not satisfy the United States face sanctions in the form of property arrest. After this the US started talks and if these talks are successful the arrest is lifted. They are using real blackmail to promote their own interests inside our country," Fyodorov said in an interview with Izvestia daily.

The newspaper also quoted an unnamed source in the Russian presidential administration as saying that the authorities are now planning to expand the concept of "nationalization of elites" first introduced last year. "Any catch - and foreign real estate is a very strong catch - is a real threat to national security and can put pressure on the decision makers inside the country," the source said.

The official added that the new restrictions would also rule out risks to their reputation and the possibility of scandalous disclosures that put Russian civil servants in jeopardy.

However, one of the members of the anti-corruption committee, Communist Party MP Yevgeniy Dorovin holds that Russia has more urgent internal worries than a new property ban.

"What they take they will return. It is not wise to make decisions that could harm particular people on the basis of a momentary situation," Dorovin said.

In August last year Russian authorities introduced the law "On Civil Servants' Foreign Assets" that banned members of parliament, senior officials, top managers of state corporations and the Russian Central Bank to hold accounts in foreign banks and own securities of foreign companies. The restriction also extends to these people's spouses and underage children.

The initial draft of the asset ban included real estate, but the MPs got rid of it during the debate procedure saying that many Russian officials have possessed country homes, apartments, and land in neighboring countries since Soviet times and making them sever these ties would be unjust.

In October last year the head of the Russian presidential administration Sergey Ivanov disclosed that about 1000 civil servants at state and municipal level possessed foreign realty. 600 pieces of this real estate were located in former Soviet republics and many of the remaining 400 were in resort areas such as Turkey, Bulgaria, Spain and Egypt.
March 21, 2014
Sanctions effect: Russia to change its economic partners...for the better
By Irina Sukhoparova

Western sanctions might push Russia to deepen cooperation with BRICS states, in particular, to strengthen its ties with China, which will possibly turn out to be a big catastrophe for the US and the EU some time later.

On March 18, the spokesperson for the Kremlin, Dmitry Peskov, claimed in a BBC interview that Russia would switch to new partners in case of economic sanctions being imposed by the European Union and the United States. He highlighted that the modern world isn't unipolar and Russia has strong ties with other states as well, though Russia wants to remain in good relations with its Western partners, especially with the EU due to the volume of deals and joint projects.

Those "new partners" are not really new since Russia has been closely interconnected with them for almost 13 years. This is all about the so-called BRICS organization, consisting of Brazil, Russia, India, China and South Africa. BRICS represents 42 percent of the world's population and about a quarter of the world's economy, which means that this bloc of states is an important global actor.

The BRICS countries are like-minded in regard to supporting the principles of international law, the central role of the UN Security Council and the principles of the non-use of force in international relations; this is why they are so actively performing in the sphere of settling regional conflicts. However, the cooperation between Brazil, Russia, India, China and South Africa goes beyond political aspects and is also demonstrated by dynamic trade and multiple projects in different areas. Today, in total, there are more than 20 formats of cooperation within the BRICS which are intensively developing. For example, in February the member-states came to an agreement about 11 prospective directions of scientific and technical cooperation, from aeronautics to bio- and nanotechnology. In order to modernize the global economic system, at the center of which stand the US and the EU, the leaders of Brazil, Russia, India, China and South Africa have created the BRICS Stock Alliance and are creating their own development bank to finance large infrastructure projects. On the whole, despite fierce criticism of BRICS as an organization with no future, it is developing and increasing cooperation with its members and, in fact, BRICS is showing pretty good results.

With suspension of Russian participation in G8 and possible strengthening of economic sanctions, the experts expect some particular industries to be targeted, including limits on imported products. While the West seeks to hit Russia hard, it is important to notice that Russia is ready to switch to other markets, for instance BRICS, and increase trade volumes with countries from this bloc.

Indeed, Russia buys significant amount of products from NATO states, for example, 50 percent of fruits and berries come from Spain, Holland and Poland. Nevertheless, Russia is intensifying its economic ties with the developing world. In 2012 Russia was buying 41 percent of its beef from Brazil, though this index has recently decreased to 20 percent, and Russia is likely to increase its import in case of need. In February 2013, Russia and Brazil reached an agreement on the long-standing problem of pork exports to Russia, as well as agreeing on a list of sanitary and quality requirements for the annual import of millions of metric tons of Russian wheat. This is a shining example of the substitute partnerships that have yielded positive results, although some problems with sanitary norms had to be resolved. In other words, it's beyond the power of the EU and US to make Russian people suffer from products scarcity since they are not the country's only trade partners.

The biggest brick in BRICS

It's hard to ignore the fact that the role of the biggest and strongest member of BRICS is China's, and obviously Russia will seek to improve its relations with Beijing even more than before. During the last year, relations between Russia and China have been enhancing and actively developing in various spheres. In particular, in 2013 the states signed 21 trade agreements, including a new 100 million ton oil supply deal with China's Sinopec. In October 2013, the Xinhua news agency also reported that the two governments signed an agreement to jointly build an oil refinery in Tianjin, east of Beijing.

Moreover, China promised to pump $20 billion of investment into domestic projects in Russia, focusing on transport infrastructure, highways, ports, and airports, and it hoped to increase investment in Russia four-fold by 2020. In 2013, the trade volume between the states reached $89 billion, with bilateral economic relations showing positive signs, meaning that further cooperation will increase.

Indeed, leaders of the states called for annual bilateral trade between the two countries to be boosted to $100 billion by 2015. Besides, the two countries are considering further partnerships in the energy sector, particularly in the gas industry.

Currently, Russian gas is not supplied to China, though in 2013 Russia's biggest independent natural gas producer, Novatek, signed preliminary memorandums with CNPC to sell at least 3 million tons of LNG per year between Yamal LNG and PetroChina International. Another Russian company, Rosneft, which is 75 percent state-owned, is vastly expanding its LNG projects to diversify its portfolio, and is focusing heavily on eastern markets, like Japan and China. In terms of confrontation between the West and Russia, the gas contracts between China and Russia could really gain momentum. At the same time it's possible that Moscow would sign contracts on the sale of the Sukhoi Su-35 fighter to China before President Putin embarks on a visit to Beijing in May.

In 2014, Russia and China have a full agenda for bilateral cooperation, which includes not only trade but also such spheres as energy, aircraft building, mechanical engineering, military and science cooperation, tourism, etc. At the same time, cultural ties between the two nations are also strengthening, with 2014-2015 being named years of youth exchange. The leaders of Russia and China also decided to prepare jointly celebration events for the 70th anniversary of the victory over German fascism and Japanese militarism in 2015.

Another important aspect of cooperation between Russia, China and India touches upon Afghanistan. The trilateral involvement of those nations into the Afghan issue has been actively developing since 2013 and could become a major factor for the Afghan leadership following the US withdrawal. It is important to note that the Afghanistan issue is vital to the regional security of Russia, China and India.

Once again, the recent Olympic Games emphasized the specific character of relations between China and Russia. The Chinese president, unlike European leaders, was present at the Opening Ceremony, which is especially demonstrative given that it was the time of the Spring Festival in China, when the Chinese prefer not to leave their homes except for visiting relatives and close friends.

Thus, China may become the biggest beneficiary of the sanctions against Russia since it means further rapprochement between Russia and China. One should remember that China has always been mainly interested in doing business and for sure it would be silly for Beijing to lose such a great opportunity to strengthen its ties with Russia. If I were someone responsible for decisions in Brussels or Washington, I would revise my opinion on implementation of sanctions against Russia. I wouldn't call it a possible revival of the "Sino-Soviet axe" which existed during the Cold War and was an ideological counter-balance for the West, although this time the West itself is pushing one of its main rivals closer to another, creating a massive power that would surpass both the US and the EU by a long chalk. So the question is whether the West really wants this to happen? And what will it do when the Chinese dragon and Russian bear form an alliance?

Brazil is not only about meat

As was already mentioned, another BRICS-member Brazil is one of the Russian suppliers of meat, and trade in this industry is likely to rise if the West resorts to economic sanctions. However, meat import isn't the only thing that binds these states. Over the last few years, Russia has also imported Brazilian coffee, sugar, juices and alcohol and exported mainly fertilizers. Moscow and Brasilia made a commitment to develop comprehensive cooperation in various areas, although for the moment particular attention is being paid to the military sphere. For instance, in December 2012 the states signed a treaty on supplies of Russian helicopters to Brazil.

The total trade volume between Russia and Brazil in 2013 made up $5.7 billion, however the two states seek to increase it up to $10 billion in the near future. The trade index in January 2014 reached $438.9 million, which was $25 million higher in comparison with January 2013. The distinctive feature of the cooperation between the two countries is the complimentary character of their economies, which makes ties between Brazil and Russia even stronger. In fact, there is a great potential for Russian-Brazilian cooperation and results of these ties could also be disappointing for the West.

I is for India

In his speech at a joint session of parliament on March 18, Russian President Putin thanked both India and China for their stance on the Ukrainian crisis. But why is India supporting Russia? Maybe the Indian government equates some similarities with Crimea in the history of Sikkim's referendum and further merger with India when it became the 22nd Indian state in 1975 with Russian support. Maybe India is just seeking to develop closer ties and mutually beneficial partnerships with Russia.

Anyway, let's look at some facts and figures. In 2012, bilateral trade volume reached $11,000 million which is rather modest in comparison with China or Brazil. Moreover, in 2013 this index slightly decreased. However, 2014 promises the renewal of bilateral contracts between India and Russia. For example, Defexpo India 2014 has reaffirmed the special relationship that exists between the defense industries of Russia and India, with a pavilion that houses exhibits of Russian companies being visited by top members of the Indian establishment. In general, the defense interactions between Russia and India are quite diversified, with almost every defense contract providing the creation of joint ventures or licensed production. In 2013, India's import of Russian weapons reached $4.78 billion. Another industry which attracts India is computer-guided weapons, produced by the Russian Morinformsystem-Agat Concern.

In February the two states also confirmed their plans to boost cooperation in nuclear energy, with the former backing the construction of more units at the Kudankulam Nuclear Power Project (KNPP) and other parts of the country. Besides, India and Russia are set to sign an agreement aimed at productive cooperation in many spheres: space and military cooperation, trade, construction of a pipeline from Russia to India, and plans to set up a Joint Study Group to look into the scope of the CECA (Comprehensive Economic Cooperation Agreement) with member-countries of the Customs Union (the Russian Federation, Kazakhstan and Belarus). It is certain that after this issue is addressed, trade volumes between Russia and India, as well as between the Customs Union and India will increase significantly.

Costs for the West

It's not really rational for the US and the EU to antagonize and try to isolate Russia. And there are several reasons for this. First of all, Russia is the largest oil and gas producer in the world and it simply means that imposing economic sanctions on Russia would shake up the global energy market and, therefore, the entire global economy. Not to mention the EU's dependency on Russian gas. Are the global economies ready to witness a new crisis, given that they are still recovering from the latest financial crisis? It's doubtful.

Second, Russia is investing massively in the US financial market, especially in Treasury bonds, and consequently, if Russia decides to withdraw its investments in response to Western sanctions, it would hit the US economy and cause a real financial crisis. So, crisis again.

Finally, during the last few years the Russian market has become one of the world's largest markets for EU goods, products and services, while the EU is actively investing in Russia. In case of further worsening of relations between Russia and the West, the EU will have a serious headache, searching for new markets and suffering lasting damage because of suspended joint contracts.

So is it really worth pushing for such a gloomy future, or is it better to recognize the will of the Crimeans and give the whole of Ukraine a chance for a better life?
Ukraine-EU Pact Signals Step Towards NATO - Russian Ministry Source

MOSCOW, March 24 (RIA Novosti) - The signing of a political pact between Ukraine and the European Union is a hasty step which points to the prospect of closer military ties between Kiev and NATO, a Russian foreign ministry source said Monday.

"The political provisions of the association deal pave the way for further entrenchment of Ukraine into the foreign policy and military orbit of the EU and the West in general," the official said.

Russia has vociferously opposed any further eastward expansion by NATO, particularly by former Soviet republics on its borders. President Vladimir Putin said last week Moscow was open to further cooperation with NATO, but remained opposed to the organization's presence in historic Russian territories.

Ukraine and Georgia have been lobbying to become NATO members for years, enjoying full support for their bids from the US, but alliance members rejected a proposal to offer them membership at a NATO summit in Bucharest in 2008.

Ukraine's Western-backed interim prime minister, Arseniy Yatsenyuk, appointed by the country's parliament last month, signed the political portion of an expanded association agreement with the European Union in Brussels on Friday. A similar agreement was rejected by the country's ousted president in November in favor of closer ties with Russia.

The economic and trade provisions of the deal will not be agreed upon until after the upcoming presidential election scheduled for May.

"We can expect that under current circumstances the signing of the agreement will be followed by steps towards closer cooperation, including in terms of the evolution of the Common Security and Defense Policy (CSDP) and its potential link with NATO activity," the source said.

"If the political association is considered a long-term choice made by both sides, why would the signing of such an important document be made with the head of a self-imposed government, without waiting for presidential elections in May?" the source said.

Russia does not recognize the interim government in Ukraine and insists that all new decisions should be taken by democratically-elected Ukrainian leaders after the May vote.

New York Times
May 2, 1998
Foreign Affairs; Now a Word From X

His voice is a bit frail now, but the mind, even at age 94, is as sharp as ever. So when I reached George Kennan by phone to get his reaction to the Senate's ratification of NATO expansion it was no surprise to find that the man who was the architect of America's successful containment of the Soviet Union and one of the great American statesmen of the 20th century was ready with an answer.

''I think it is the beginning of a new cold war,'' said Mr. Kennan from his Princeton home. ''I think the Russians will gradually react quite adversely and it will affect their policies. I think it is a tragic mistake. There was no reason for this whatsoever. No one was threatening anybody else. This expansion would make the Founding Fathers of this country turn over in their graves. We have signed up to protect a whole series of countries, even though we have neither the resources nor the intention to do so in any serious way. [NATO expansion] was simply a light-hearted action by a Senate that has no real interest in foreign affairs.''

''What bothers me is how superficial and ill informed the whole Senate debate was,'' added Mr. Kennan, who was present at the creation of NATO and whose anonymous 1947 article in the journal Foreign Affairs, signed ''X,'' defined America's cold-war containment policy for 40 years. ''I was particularly bothered by the references to Russia as a country dying to attack Western Europe. Don't people understand? Our differences in the cold war were with the Soviet Communist regime. And now we are turning our backs on the very people who mounted the greatest bloodless revolution in history to remove that Soviet regime.

''And Russia's democracy is as far advanced, if not farther, as any of these countries we've just signed up to defend from Russia,'' said Mr. Kennan, who joined the State Department in 1926 and was U.S. Ambassador to Moscow in 1952. ''It shows so little understanding of Russian history and Soviet history. Of course there is going to be a bad reaction from Russia, and then [the NATO expanders] will say that we always told you that is how the Russians are -- but this is just wrong.''

One only wonders what future historians will say. If we are lucky they will say that NATO expansion to Poland, Hungary and the Czech Republic simply didn't matter, because the vacuum it was supposed to fill had already been filled, only the Clinton team couldn't see it. They will say that the forces of globalization integrating Europe, coupled with the new arms control agreements, proved to be so powerful that Russia, despite NATO expansion, moved ahead with democratization and Westernization, and was gradually drawn into a loosely unified Europe. If we are unlucky they will say, as Mr. Kennan predicts, that NATO expansion set up a situation in which NATO now has to either expand all the way to Russia's border, triggering a new cold war, or stop expanding after these three new countries and create a new dividing line through Europe.

But there is one thing future historians will surely remark upon, and that is the utter poverty of imagination that characterized U.S. foreign policy in the late 1990's. They will note that one of the seminal events of this century took place between 1989 and 1992 -- the collapse of the Soviet Empire, which had the capability, imperial intentions and ideology to truly threaten the entire free world. Thanks to Western resolve and the courage of Russian democrats, that Soviet Empire collapsed without a shot, spawning a democratic Russia, setting free the former Soviet republics and leading to unprecedented arms control agreements with the U.S.

And what was America's response? It was to expand the NATO cold-war alliance against Russia and bring it closer to Russia's borders.

Yes, tell your children, and your children's children, that you lived in the age of Bill Clinton and William Cohen, the age of Madeleine Albright and Sandy Berger, the age of Trent Lott and Joe Lieberman, and you too were present at the creation of the post-cold-war order, when these foreign policy Titans put their heads together and produced . . . a mouse.

We are in the age of midgets. The only good news is that we got here in one piece because there was another age -- one of great statesmen who had both imagination and courage.

As he said goodbye to me on the phone, Mr. Kennan added just one more thing: ''This has been my life, and it pains me to see it so screwed up in the end.''
Moscow Times
What the Papers Say, March 24, 2014


1. Yury Barsukov article headlined "Crimea found, debt remains" says that Russia has decided to withdraw from the Russian-Ukrainian agreements on the deployment of the Black Sea Fleet, signed in Kharkiv in 2010. The move threatens Kiev not only with the doubling of gas prices but also with quadrupling of its gas debt to Russia; pp 1, 8 (597 words).

 2. Svetlana Dementyeva et al. article headlined "They have fraternal immunity" says that sanctions from U.S. payment systems Visa and MasterCard against the banks controlled by Russian businessmen Arkady and Boris Rotenberg have been effective for two days as it has turned out that there are no legal grounds to block the operations of the banks; pp 1, 8 (1,041 words).

 3. Svetlana Dementiyeva article headlined "Peninsula of stability" says that four bills regulating the operations of Ukrainian banks in Crimea and Sevastopol have been submitted to the State Duma. Banks will be operating as usual until 1 Jan., 2015 if they fulfil their obligations. If they do not, they will be shut down. Ukrainian banks that will remain by the set term are to be transformed into Russian ones or quit the market; pp 1, 8 (652 words).

 4. Natalia Gorodetskaya article headlined "Municipalities stick to old forms" says that the State Duma is expecting approving comments from regional parliaments and governors on a local government reform that would abolish direct mayoral elections in large cities that are divided into districts. However, municipalities intend to oppose the reform; p 2 (532 words).

 5. Ivan Safronov article headlined "Anatoly Shilov accepted to state service" says that the Federal Space Agency, or Roscosmos, has decided to launch the latest electronic reconnaissance and communications satellite Olimp in late May. The result of the launch will determine the future of Roscosmos deputy head Anatoly Shilov, the article says; p 2 (432 words).

 6. Anna Pushkarskaya et al. article headlined "Russian laws prepared for Crimea" says that President Vladimir Putin has instructed the government to develop and approve a plan to establish regional directorates of federal agencies in Crimea and Sevastopol. The State Duma is ready to hold extraordinary meetings to pass laws necessary for the new regions' integration with Russia; p 3 (550 words).

 7. Andrei Pertsev article headlined "Spin doctors need general cover" says that the Russian Association of Spin Doctors has been established in Russia during the past weekend. Igor Mintusov, the head of the Nikkolo M Strategic Communications Agency, has headed the new organization; p 3 (448 words).

 8. Alexei Sokovnin and Andrey Tsvetkov article headlined "Former deputy minister being searched in court" says that a Moscow court will consider today issuing an arrest warrant in absentia for former Deputy Agriculture Minister Alexei Bazhanov, charged with embezzlement of Rosselkhozbank's loan; p 5 (464 words).

 9. Tatyana Yedovina article headlined "EU changes polarity of pipes" says that the EU has decided not only to impose sanctions against Russian officials but also to reduce its dependence on the gas supplies from Russia. The article features a Russian pundit's comment; p 6 (505 words).

 10. Kirill Belyaninov article headlined "Coalition for isolation" says that U.S. President Barack Obama intends to take advantage of the nuclear security summit that opens today in The Hague to try to strip Russia of G8 membership; p 6 (468 words).

 11. Yelizaveta Kuznetsova et al. article headlined "Bombardier heads for U.S." says that Canadian company Bombardier may suspend the setting-up of a joint venture with Russia to produce Q-400 aircraft due to Canada's introducing sanctions against Russia; p 8 (542 words).

 12. Natalia Skorlygina et al. article headlined "Lithuania tied to Russia's energy sector" says that Russia and Belarus will coordinate electric energy supplies to Lithuania to avoid competition on its market; p 9 (554 words).

 13. Vladislav Novy and Yekaterina Mikhaylina article headlined "Rostelecom leaves salons" says Russian telephony provider Rostelecom will cut its retail sales by 50 percent; p 10 (600 words).

Nezavisimaya Gazeta

1. Tatyana Ivzhenko article headlined "They ask Yanukovych to return" says that the new Ukrainian authorities believe that the presidential election will be held on May 25 despite Crimea's joining Russia and instability in the country's southeast, where rallies in support of former Ukrainian President Viktor Yanukovych have been held; pp 1, 6 (1,367 words).

 2. Ivan Rodin article headlined "Speeding up of Crimea's integration cuts holes in budget" says that President Putin has instructed the government to set up regional directorates of ministries and federal agencies in Crimea and Sevastopol. Also, the new regions' banking sector is being built into the Russian financial system. The move will cost 45 billion rubles (about $1.25 billion at the current exchange rate), but the Russian authorities are ready for any expenses as regards Crimea, the article says; p 1, 3 (828 words).

 3. Alexei Gorbachev article headlined "State to defend judge in Bolotnaya case" says that state protection will be provided to judge Natalia Nikishina, who has imprisoned defendants in the so-called Bolotnaya case of the May 6 2012 riots in Moscow's Bolotnaya Ploshchad. Meanwhile, the trial of Left Front activists Sergei Udaltsov and Leonid Razvozzhayev, charged with organizing riots, will resume today; pp 1, 3 (527 words).

 4. Yury Paniyev article headlined "Nuclear security overshadowed by crisis" previews the third nuclear security summit that opens today in The Hague. President Putin will not attend the event, on the sidelines of which the G7 group will meet to discuss stripping Russia of G8 membership. Foreign Minister Sergei Lavrov will represent Russia at the summit; pp 1-2 (604 words).

 5. Anastasia Bashkatova article headlined "Capital city sets record of being modest" looks at regional officials' salaries in Russia in 2013; pp 1, 4 (1,118 words).

 6. Alina Terekhova article headlined "Tymoshenko promises gas divorce" says that following the EU, Ukraine is considering reducing the dependence on Russian gas supplies. The article features Russian pundits' comments; pp 1, 4 (881 words).

 7. Editorial headlined "How university earns reputation" reviews the performance of the Russian universities; p 2 (400 words).

 8. Vladimir Mukhin article published in the regular Carte Blanche column headlined "Russia does not have plans to conquer Ukraine" tries to explain why Ukraine is still afraid of Russia given that Russian servicemen are no longer deployed at the Russian-Ukrainian border and President Putin has declared that Russia is not planning to invade Ukraine; p 3 (847 words).

 9. Mikhail Sergeyev article headlined "Industries taste Crimea" says directors of the Russian industrial enterprises have become more optimistic about the economic effects of the Ukrainian crisis; p 4 (700 words).

 10. Vladimir Skosyrev article headlined "Americans spied on Chinese president" says that the U.S. National Security Agency is said to have penetrated into China's largest telecommunications company Huawei to intercept former Chinese president Hu Jintao's electronic correspondence. This became known the day before a meeting between the U.S. and Chinese presidents in The Hague on the sidelines of the nuclear security summit. The scandal will not worsen U.S.-Chinese relations, a Russian expert said; p 6 (697 words).

 11. Boris Nikolayev article headlined "Auxiliary role of transport and energy complex" focuses on a "new vision" of the energy strategy in Russia; pp Energia 1, 10 (900 words).

 12. Alexei Khaytun article headlined "Southern variant" says the economic structure of Crimea needs big investments; Energia p 12 (1,000 words).

 13. Oleg Nikiforov article headlined "Cost of unification" says the secession of Crimea from Ukraine creates significant economic and legal difficulties for both Kiev and Moscow; Energia p 12 (900 words).

 14. Oleg Nikiforov article headlined "Paradoxes of Ukrainian transit" says the energy security of Europe still depends on the gas transit through Ukraine. Gazprom needs to establish cooperation with Kiev to secure deliveries to Europe, it says; Energia p 13 (900 words).


1. Maxim Tovkaylo et al. article headlined "Tax paradise Crimea" says that the Russian government is considering the prospects for Crimea's socioeconomic development that include making the peninsula a special economic zone, establishing a state-run corporation for Crimea's development and adopting a special federal targeted-development program; pp 1, 5 (500 words).

 2. Editorial headlined "Demon of sanctions" comments on the Western sanctions against Russia. The existing situation is advantageous to both Russia and the West since none of the sides is interested in sanctions being toughened. However, Moscow cannot but take measures in response as a lack of the latter will be seen as weakness; pp 1, 6 (400 words).

 3. Alexei Nikolsky article headlined "No more Forces" says that almost all the Ukrainian military units in Crimea have been disarmed and occupied by the Crimean self-defense troops and Russian servicemen at support of civil protesters; p 2 (400 words).

 4. Polina Khimshiashvili and Svetlana Bocharova article headlined "Decision without consequences" says that the Venice Commission has unanimously recognized the March 16 referendum in Crimea as unconstitutional and nonconforming with European law practice. Conclusions made by the commission are nonbinding and are not valid as judicial decisions, a Russian expert said; p 2 (500 words).

 5. Yelena Morozova et al. article headlined "Elections without One Russia member" says that a Novosibirsk court has withdrawn acting mayor Vladimir Znatkov, who is standing in the April 6 mayoral election in Novosibirsk as a United Russia nominee, from the election, thus having satisfied a lawsuit filed by his rival, former Federation Council senator Ivan Starikov; p 3 (200 words).

 6. Olga Kuvshinova article headlined "Russia near zero" says it would be hard for the Russian economy to avoid recession, but if the Ukrainian crisis narrows, the recession will not last long; p 4 (700 words).

 7. Margarita Papchenkova article headlined "Devaluation to rescue Finance Ministry" says Russia may give up taking external loans this year because of the U.S. and EU sanctions, according to Finance Minister Anton Siluanov; p 4 (300 words).

 8. Editorial headlined "Example of instability" says that Crimea's joining Russia may escalate the existing territorial disputes in the post-Soviet space; p 6 (300 words).

 9. Political expert Yekaterina Shulman article headlined "Speed of dream" criticizes the Russian State Duma for the speedy adoption of laws, including such important ones as the federal law on Crimea's joining Russia, changing Russia's state borders, which was approved within two days; p 6 (800 words).

 10. Gleb Pavlovsky article headlined "Global Putin's moment" looks at President Putin in his third presidential term. He is an absolutely different man, who is not afraid of trusting his personal, though trashy feelings, and doing things that earlier he could not imagine. Putin is no longer showing a false face, he is playing and enjoys this game, the author says; p 7 (800 words).

 11. Kirill Kharatyan article headlined "Person of week: Barack Obama" disagrees with a view, gaining popularity in Russia, that U.S. President Barack Obama is a weak politician. U.S. sanctions are not aimed against Russia, but personally against Putin, against people who he relies on, the author says; p 7 (300 words).

 12. Maxim Buyev article headlined "Dilemma of prisoner" focuses on the Western sanctions on Russia, saying that the European financial system is more dependent on the Russian economy than the US one; p 7 (400 words).

 13. Yelena Khodyakova and Yulia Orlova article headlined "Minus nine percent because of Timchenko" says investors are scared that the U.S. sanctions against Russian businessman Gennady Timchenko will damage an associated gas company, Novatek; p 11 (600 words).

 14. Roman Shleynov et al. article headlined "Endangered business" says that only four businessmen close to President Putin, who have been included in the blacklist of Russians subject to EU and US sanctions, have solid assets abroad and may have problems with their business; pp 20-21 (1,200 words).


1. Alena Sivkova and Yegor Sozayev-Guryev article headlined "Office of president to check state facilities of Crimea" says the office of President Vladimir Putin will soon check all the state-owned facilities in Crimea, including the hotels and residences; pp 1, 3 (600 words).

 2. Alexandra Bayazitova article headlined "Lawmakers demand compensations from Visa and MasterCard" says the Russian lawmakers have suggested that the two payment systems should compensate for the losses they inflicted on Russian citizens in connection with the US sanctions; pp 1-2 (500 words).

 3. Svetlana Subbotina and Sergei Podosenov article headlined "Senator suggests that Nobel Peace Prize be taken away from Obama" says Russian senator Lyudmila Bokova has condemned U.S. President Barack Obama's policy of double standards; pp 1-2 (300 words).

Rossiiskaya Gazeta

1. Kira Latukhina article headlined "Constituent parts of Federation" says that President Putin has signed laws on Crimea and Sevastopol becoming parts of Russia; pp 1, 3 (602 words).

 2. Vladimir Bogdanov and Sergei Ptichkin article headlined "Striking force" says that Su-34 fighters have been put into service of Russia's Air Force; pp 1, 3 (492 words).

 3. Kira Latukhina article headlined "Time to pay back advanced payments" says that President Putin has met permanent members of the Russian Security Council to discuss Russian-Ukrainian relations, including gas cooperation; p 2 (941 words).

 4. Vitaly Petrov article headlined "Justice first of all" says that the Federation Council has ratified the treaty on Crimea's joining Russia and the federal constitutional law on establishing new constituent parts of Russia, the Crimea republic and city of federal importance Sevastopol; p 3 (607 words).

 5. Igor Zubkov interview with academician Viktor Ivanter, headlined "Five years without slovenliness", who says that Crimea is not a burden, but a nice present for Russia; p 4 (1,211 words).

 6. Yelena Domcheva and Igor Zubkov article headlined "Mark with minus" says that international rating agencies Standard and Poor and Fitch have degraded Russia's sovereign rating from "stable" to "negative" over a threat of sanctions against Russian businesses; p 4 (530 words).

 7. Yevgeny Shestakov article headlined "'Arsonist' emerges in Britain" looks at anti-Russian sanctions that British Foreign Minister William Hague has called for in an interview with newspaper Daily Telegraph; p 7 (707 words).

Moskovsky Komsomolets

1. Yulia Kalinina article headlined "Victory Day to become day of grief in Ukraine" says that the Ukrainian culture minister has drafted a bill, according to which Victory Day in the World War II will be marked on May 8 as in Europe, but not on May 9 as in Russia. Moreover, May 9 will be marked as the day of remembrance of victims of Soviet occupation; p 1 (448 words).

 2. Marina Perevozkina article headlined "Ukrainian servicemen go to Crimea" says that most servicemen at the headquarters of the Ukrainian Navy's coast Defense in Simferopol have decided to serve Russia; pp 1, 3 (624 words).

 3. Natalia Vedeneyeva article headlined "Black holes of Russian space" looks at the Russian space sector, problems facing it and the pending reforms in the Federal Space Agency, or Roscosmos; pp 1, 5 (2,845 words).

 4. Igor Subbotin article features a piece of radio communication between one of the pilots of the Malaysian aircraft that has gone missing two weeks ago and an air traffic controller; p 2 (1,073 words).

 5. Oleg Bazak article headlined "Mr. candidate Dmytro Yarosh" says that former Ukrainian Prime Minister Yulia Tymoshenko has taken advantage of Crimea's joining Russia to enlist support from as much Ukrainians as possible ahead of the May 25 presidential election. Right Sector head Dmytro Yarosh has also declared his presidential ambitions; p 3 (610 words).

 6. Yelena Gamayun article headlined "Squadron of mine workers" reports on the anti-government rallies in Donetsk that took place in the city during the weekend; p 3 (300 words).

Novaya Gazeta

 1. Sergei Kanev report "Criminal" looks at the situation in Crimea and says that although the redistribution of property has not ended in the peninsula, the new redistribution is looming; p 7 (1,100 words).

 2. Alexei Polukhin report "To cede cards" says that U.S. President Barack Obama has presented an enlarged sanction blacklist in relation to Russia. This list significantly coincides with the list published by opposition activist Alexei Navalny in his column in The New York Times and includes Putin's close associates; p 8 (1,200 words).

 3. Irina Gordyenko report "Name of Dokka Umarov's successor announced" says that the leadership of the banned organization Imarat Kavkaz (Caucasus emirate) has said that Caucasus insurgency leader Dokka Umarov has died, and named his successor; p 9 (750 words).

 4. Andrei Kolesnikov article headlined "Heroes of Russia or 'Ozero school'" says that Obama has "punished members of the cooperative Ozero". Their property and assets in the U.S. are frozen and they are banned from entering the U.S.; p 10 (450 words).

 5. Newspaper publishes excerpts from Mikhail Khodorkovsky's book "Prison people" that comes out in May; p 19 (1,100 words).

RBK Daily

 1. Yelena Malysheva et al. report "Service of one income" says that the government is discussing the possibility of merging Russia's tax and customs services; pp 1, 3 (800 words).

 2. Ivan Petrov report "Russian sailors not lucky" says that the fact that Crimea has become part of Russia will result in a considerable decrease in the salaries of Russian seamen serving in Crimea; p 2 (700 words).

 3. Ivan Petrov report "Envoy from Slavyanka" says that Crimea has become Russia's ninth federal district. A person from the Defense Ministry-controlled Oboronservis holding company will become Putin's envoy there, article says; p 2 (550 words).

 4. Maria Makutina report "Term of return" says that as from May 9, calls for actions aiming to return Crimea to Ukraine will be made an imprisonable offense in Russia; p 2 (600 words).

 5. Andrey Kotov report "Obama's European tour" looks at the Nuclear Security Summit opening in The Hague on March 24; p 4 (450 words)

Noviye Izvestia

 1. Yekaterina Dyatlovskaya report "Ninth district" says that Crimea is being built into the Russian system of state power. Putin has issued instructions to approve a plan to set up territorial offices of Russian ministries and agencies in Crimea and Sevastopol; pp 1-2 (550 words).

 2. Mark Agatov report "Last aerodrome" says that practically all military facilities of the Ukrainian army in Crimea are controlled by Russia; p 2 (600 words).

 3. Valery Yakov report "Crimean syndrome" says that "Western countries have recognized Russia's victory in Crimea". Author refers to the EU's sanctions against Russia as "helpless"; p 2 (500 words).

 Komsomolskaya Pravda

 1. Alexei Ovchinnikov report "'Sevastopol waits, Kamchatka waits, Kronshtadt waits"' says that 10 Ukrainian warships have "sided with Russia"; p 6 (350 words).

 2. Maxim Brusnev report "'You are married to representative of Department of State. What happened to your reputation?"' looks at how Russia's permanent representative at the UN Vitaly Churkin has reacted to accusations of a CNN journalist; p 7 (600 words).

 3. Anton Araslanov interview "Three men refused this post" with Crimea's new prosecutor-general, Natalya Poklonskaya; p 9 (650 words).
Wall Street Journal
March 24, 2014
U.S. Scurries to Shore Up Spying on Russia
In Crimea, Russia May Have Gotten a Jump on West by Evading U.S. Eavesdropping
By Adam Entous, Julian E. Barnes and Siobhan Gorman

A look at the holes in U.S. intelligence in the run up to the Crimea takeover and the scramble to address them. WSJ's national security correspondent Adam Entous joins the News Hub with the exclusive. Photo: Getty.

U.S. military satellites spied Russian troops amassing within striking distance of Crimea last month. But intelligence analysts were surprised because they hadn't intercepted any telltale communications where Russian leaders, military commanders or soldiers discussed plans to invade.

America's vaunted global surveillance is a vital tool for U.S. intelligence services, especially as an early-warning system and as a way to corroborate other evidence. In Crimea, though, U.S. intelligence officials are concluding that Russian planners might have gotten a jump on the West by evading U.S. eavesdropping.

"Even though there was a warning, we didn't have the information to be able to say exactly what was going to happen," a senior U.S. official says.
To close the information gap, U.S. spy agencies and the military are rushing to expand satellite coverage and communications-interception efforts across Russia, Ukraine and the Baltic states. U.S. officials hope the "surge" in assets and analysts will improve tracking of the Russian military and tip off the U.S. to any possible intentions of Russian President Vladimir Putin before he acts on them.

The U.S. moves will happen quickly. "We have gone into crisis-response mode," a senior official says.

Still, as Russia brings additional forces to areas near the border with eastern Ukraine, America's spy chiefs are worried that Russian leaders might be able to cloak their next move by shielding more communications from the U.S., according to officials familiar with the matter. "That is the question we're all asking ourselves," one top U.S. official says.

The Obama administration is "very nervous," says a person close to the discussions. "This is uncharted territory."

It all comes amid the backdrop of a worried government in Kiev. Ukraine's foreign minister said Sunday that the troop buildup is increasing the possibility of war with Russia.

Months before the takeover, U.S. spy agencies told White House policy makers that Mr. Putin could make a play for Crimea, home to strategically important Russian naval installations. That led to an unsuccessful diplomatic push by the Obama administration.

When the moment arrived, U.S. attention was focused on the troops on Russian soil. Instead, forces already inside Crimea were spearheading the takeover of the peninsula, before U.S. spy agencies fully realized what was happening.

Citing conflicting assessments from intelligence agencies, Rep. Michael Rogers, Republican chairman of the House Intelligence Committee, has launched a review of whether spy agencies misjudged Mr. Putin's intentions. Agency officials say the differences were relatively small and reflected the competing analysis that policy makers expect intelligence agencies to conduct.

Some Obama administration, military and intelligence officials say they doubt the U.S. could have done much differently. Even with a clearer understanding of Mr. Putin's plans, the Obama administration thought it had few options to stop him. U.S. spy chiefs told President Barack Obama three days before the Crimea operation that Russia could take over the peninsula so fast that Washington might find out only when it was done.

Some U.S. military and intelligence officials say Russia's war planners might have used knowledge about the U.S.'s usual surveillance techniques to change communication methods about the looming invasion. U.S. officials haven't determined how Russia hid its military plans from U.S. eavesdropping equipment that picks up digital and electronic communications.

Since the end of the Cold War, U.S. spy satellites and other intelligence-gathering assets have been focused less on Russia and more on counterterrorism, the Middle East and Asia, reflecting shifting U.S. priorities.

"This is the kind of thing young military officers are going to be reading about in their history books," says one senior U.S. official.

As early as December, U.S. intelligence analysts and diplomats got indications that Mr. Putin had his eye on Crimea. Widespread protests in Kiev against then-Ukrainian President Viktor Yanukovych concerned the Kremlin. The analysts and diplomats warned that Moscow could take unspecified measures to protect Russian interests in Crimea if the situation worsened.

The U.S. military's European Command asked the Pentagon to increase intelligence-collection efforts in the region, including satellite coverage. Images showed what U.S. officials described as typical military movements at Russian bases in Crimea.

Looking back, some U.S. officials now suspect Russia might have been trickling more highly trained units into Crimea in small numbers. But U.S. intelligence analysts didn't pick up any such indications before the takeover, officials briefed on the intelligence-gathering effort say.

In early February, Geoffrey Pyatt, the U.S. ambassador to Ukraine, dispatched a team of embassy officers to Crimea. The details they brought back were sketchy but raised concerns in diplomatic circles.

Human-rights activists, members of the Tartar community and other local contacts told the American team that new political groups were being formed in Crimea with a clear anti-Kiev agenda. Yet nothing in the internal reports written about the visit made Mr. Pyatt and other diplomats think Russia was planning to invade, according to officials.

A turning point came after violence started to grow on Feb. 18, a U.S. intelligence official says. Officials began to examine whether a "rapid change in government" in Kiev would draw Moscow into the conflict militarily.

U.S. suspicions peaked on Feb. 25, four days before the Russians seized Crimea. Russia's Defense Ministry invited the U.S. military attaché in Moscow to a briefing, where officials spelled out plans for a massive military exercise near Ukraine and Crimea.

U.S. defense and intelligence officials say they worried the exercise was cover for a move on Ukraine, a tactic Moscow used in 2008 before its intervention in Georgia. Intelligence assessments delivered to policy makers after the briefing put the word "exercises" in quotation marks, reflecting skepticism among analysts. Satellite images showed a clear troop buildup near Ukraine.

European Command officials again asked for more intelligence-collection resources. The military increased satellite coverage of Ukraine and Russia but couldn't steer too many resources away from Afghanistan, North Korea, Iran and other hot spots, U.S. officials say.

In Feb. 26 briefings to Mr. Obama and other policy makers, James Clapper, the director of national intelligence, and other spy chiefs singled out Crimea as a flashpoint. The assessment said the Russian military was likely making preparations for possible operations in Crimea. Mr. Obama was told the operations could be launched with little warning.

But U.S. intelligence agencies didn't have corroborating evidence. Mr. Putin and other Russian leaders gave little away in internal communications picked up by the U.S. "We didn't have someone saying: 'Let's do this,' " one U.S. official recalls.

It isn't clear if Russian leaders deliberately avoided communicating about the invasion or simply found a way to do so without detection by the U.S. Another possibility: Mr. Putin made a last-minute decision to seize Crimea-and told almost no one other than those responsible for carrying out the invasion. Some U.S. and U.K. officials believe that Russia's takeover plan was drawn up in advance and ready to go, reducing the need to discuss it.

Inside Crimea, Russian troops exercised what U.S. officials describe as extraordinary discipline in their radio and cellphone communications. Remarks that were intercepted by U.S. spy agencies revealed no hint of the plans.

On Feb. 27, Mr. Pyatt sent an urgent note to Washington. A picture attached to his note showed Russian flags flying at Crimea's parliament building. U.S. officials didn't know if the forces that seized the building were Russian or a rogue unit of the Ukrainian police force involved in the crackdown on protesters in Kiev.

There were no Americans on the ground in Crimea to check reports of Russian military movements, U.S. officials say. The U.S. also didn't have drones overhead to gather real-time intelligence, officials say. That increased the U.S.'s reliance on satellite imagery and information gleaned from an analysis of social media, which was muddled by Russian disinformation. State Department officials declined to discuss any technical-intelligence activities.

If Mr. Putin decided to launch a takeover, many U.S. intelligence analysts thought he would use troops participating in the military exercises. Officials now say they underestimated the quality of Russian forces inside Crimea.

One intelligence official says the U.S. had "definitive information that Russia was using its military to take control of the peninsula" by the night of Feb. 27, declining to be more specific. The next morning, as armed gunmen in unmarked uniforms seized strategic points in Crimea, U.S. intelligence agencies told policy makers that the gunmen likely were Russian troops.

Still, the consensus assessment from Mr. Clapper's office to Mr. Obama couldn't assign "high confidence" to reports that Russia was seizing Crimea by force because of a lack of corroborating information.

Later on Feb. 28, Mr. Obama issued his final public warning to Mr. Putin about violating Ukraine's sovereignty. By then, though, the Crimean peninsula was under Russian military control, U.S. intelligence officials said later.

Pentagon officials say much of their real-time intelligence came from local reports filed through the embassy in Kiev. The defense attache and other embassy officials worked the phones, calling Ukrainian border patrol and navy contacts. Some of those contacts told the Americans they were burning sensitive documents and reported details of Russian movements.

U.S. military officials also made urgent calls to their counterparts in Russia. Not surprisingly, Russian military officials offered little information. Some of them claimed to be surprised. "It was classic maskirovka," says a senior U.S. official, using the Russian word for camouflage. Spies use the word to describe Moscow's tradition of sophisticated deception tactics.

March 21, 2014
Sources Tell CNN's Jake Tapper Russia Could Invade Ukraine over Weekend
By Mary Chastain

CNN's Jake Tapper received information from the White House that contacts on the ground in Ukraine are concerned Russia might invade the country this weekend.

"Sources tell me from the Obama administration is quote very concerned that the Russians are not being truthful when they say their troops currently positioned on Ukraine's eastern and southern borders are merely there for training exercises," said Tapper.

The sources stressed they are not definitely sure it will happen, but they are cautious.

On March 16, a referendum in Crimea passed, purportedly showing the province's intention to leave Ukraine and join the Russian Federation. Western governments, citing a lopsided margin of victory (the vote purportedly went 95% toward secession from Ukraine) and implicit threats of violence from Russia, declared the referendum illegitimate.

The vote alone raised tension between Russia and Ukraine, but to make matters worse, Moscow decided to move over 200,000 troops to Ukraine's east border. Russian forces engaged in military exercises, which Moscow said were meant to familiarize the soldiers with the land.

Ukraine's interim president Oleksandr Turchynov's resolution to build a national guard with 60,000 people was quickly approved in response to Russia President Vladimir Putin's threat. Many Ukrainians have signed up to offer their services to protect Ukraine.

The Daily Mail (UK)
March 24, 2014
'Putin wants all of Ukraine': Kiev government warns that Russia is preparing to invade in the wake of Crimean independence vote
By Wills Robinson

Ukraine's leaders fear an imminent Russian invasion of their eastern industrial heartland after the last airbase in Crimea was taken over.

The concern follows the violent storming of the military compound in Belbek, the biggest show of Russian force in the three weeks Kremlin troops have been stationed in the peninsula.

Since the annexation of the region was confirmed on Friday, Russian troops have began to gather at the eastern border and Ukraine's military leaders believe they are ready to attack 'at any moment'.

Ukraine's National Security and Defence Council chief Andriy Parubiy told a rally in Kiev:

'The aim of Putin is not Crimea but all of Ukraine... His troops massed at the border are ready to attack at any moment,'

The interim leaders in Kiev fear that Russian President Vladimir Putin is developing a sense he could get away with further actions after the EU and US only handed him limited sanctions.

Foreign Minister Andriy Deshchytsya added: 'We do not know what Putin has in his mind and what would be his decision.

'That's why this situation is becoming even more explosive than it used to be a week ago.'

NATO's top military commander added to the fears, suggesting Russia had built up a 'very sizeable' force and even speculated Moscow could have other former Soviet states in its sights.

Supreme Allied Commander in Europe, U.S. Air Force General Philip Breedlove said Moldova, could be next if Putin decides to put his expansionist policies in place.

Breedlove was one of several Western officials and politicians to warn that Russia may not stop there in a crisis that has damaged East-West relations.

'The (Russian) force that is at the Ukrainian border now to the east is very, very sizeable and very, very ready,' the NATO commander told an event held by the German Marshall Fund think-tank.'

Fears of a military push outside Crimea also heightened after the self-declared leader of Russians living in Ukraine said they should rise up against Kiev's rule.

Crimea's Russia-backed prime minister Sergei Aksyonov said the region began facing a 'sad fate' the moment the deadly protests toppled the pro-Kremlin regime in Kiev.

'But we resisted and won! Our motherland - Russia - extended her hand of help,' said Aksyonov. 'So today, I appeal to you with a call to fight.'

United States senator John McCain compared Putin's actions to those of Adolf Hitler during the 1930's.

The foreign policy specialist said: 'I think he (Putin) is calculating how much he can get away with, just as Adolf Hitler calculated how much he could get away with in the 1930s.

U.S. President Barack Obama's deputy national security adviser Tony Blinken said the build-up might just be aimed at intimidating Ukraine's new pro-Western leaders but that Russia could invade the country's mainly Russian-speaking east.

'It's possible that they are preparing to move in,' he told CNN.

A meeting of the G7 group has been arranged for Monday in the Netherlands to allow leaders to discuss a response to Russia's actions. Obama is also set to meet Russian Foreign Minister Sergei Lavrov for bilateral talks.

Russia said it was complying with international agreements and had no plans to invade. It has called the soldiers who took over Ukrainian bases in Crimea 'self defence forces'.

Around 440 peacekeepers in Transdniestria, a breakaway state on the eastern Moldovan border with Ukraine, with soldiers guarding Soviet-era arms stocks.

It follows a launch of a new military exercise in the area, involving 8,500 artillery men, near Ukraine's eastern border 10 days ago.

'There is absolutely sufficient (Russian) force postured on the eastern border of Ukraine to run to Transdniestria if the decision was made to do that, and that is very worrisome,' Breedlove said.

The speaker of Transdniestria's parliament has urged Russia to incorporate the region, which lies to the west of Ukraine.

The new leaders in Kiev have said Moscow could seek to link up pro-Russian regions in Moldova, and Georgia to Ukraine's east.

But Moscow's ambassador to the European Union, Vladimir Chizhov, said Russia did not have 'expansionist views'.

'There is no intention of the Russian Federation to do anything like that,' he said.

Germany's Foreign Minister Frank-Walter Steinmeier underscored the huge potential repercussions of Russia's bid to redraw national borders in Europe.

'I'm very worried the unlawful attempt to alter recognised borders in our European neighbourhood, 25 years after the end of the Cold War, will open Pandora's Box,' he said.

The Guardian
March 24, 2014
Russian troops may be massing to invade Ukraine, says White House
By Jon Swaine in New York

Russian forces gathering on the border with eastern Ukraine may be poised to invade, the White House warned on Sunday, as the government in Kiev said that the prospect of war with Moscow was continuing to grow after the annexation of Crimea.

Speaking after Nato's top commander in Europe voiced alarm about the size and preparedness of the Russian troop buildup, President Barack Obama's deputy national security adviser, Tony Blinken, said President Vladimir Putin may indeed be readying further action.

"It's deeply concerning to see the Russian troop buildup on the border," Blinken told CNN. "It creates the potential for incidents, for instability. It's likely that what they're trying to do is intimidate the Ukrainians. It's possible that they're preparing to move in."

Thousands of Russian troops held a military exercise near the border even before Putin last week formally annexed Ukraine's southern Crimea region following a referendum - condemned as illegal by western governments - that endorsed unification with Russia.

General Philip Breedlove, Nato's supreme allied commander in Europe, said earlier on Sunday that the Russian military force gathered near the Ukrainian border was "very, very sizeable and very, very ready" and could even pose a threat to Moldova, on the other side of the country.

Andriy Deshchytsia, Ukraine's acting foreign minister, said the chances of all-out war between his government and Moscow "are growing", adding: "The situation is becoming even more explosive than it was a week ago."

Deshchytsia told ABC News: "We are ready to respond. The Ukraine government is trying to use all the peaceful diplomatic means ... to stop Russians, but the people are also ready to defend their homeland.

"At this moment, when Russian troops would be invading the eastern region," Deshchytsia went on, "it would be difficult for us to ask people who live there not to respond on this military invasion".

Russian forces in the Crimean city of Belbek on Saturday aggressively seized a military base that was one of the last strongholds of the Ukrainian military in the region. Moscow, meanwhile, allowed civilian observers from the Organisation for Security and Cooperation in Europe (OSCE) to begin monitoring elsewhere in Ukraine.

The Russian deputy defence minister, Anatoly Antonov, told state media on Sunday: "The Russian defence ministry is in compliance with all international agreements limiting the number of troops in the border areas with Ukraine."

Speaking from the Georgian capital, Tbilisi, Mike Rogers, the chair of the House of Representatives intelligence committee, said US intelligence officials were convinced "that Putin is not done in Ukraine".

"It is very troubling," Rogers told NBC's Meet the Press. "He has put all the military units he would need to move into Ukraine on its eastern border and is doing exercises. We see him moving forces in the south in a position where he could take the southern region over to Moldova."

Nato officials are concerned that Putin could have designs on Transnistria, a restive Russian-speaking region in western Moldova also known as Trans-Dniester, where separatist leaders have demanded to be allowed to join Russia following the annexation of Crimea.

Breedlove, the Nato commander, said during remarks at an event held by the Marshall Fund thinktank that in the Kremlin's view, the region was the "next place where Russian-speaking people may need to be incorporated".

"There is absolutely sufficient force postured on the eastern border of Ukraine to run to Trans-Dniester if the decision was made to do that," said Breedlove, "and that is very worrisome."

Moldova's President Nicolae Timofti warned Putin last week against considering the annexation of Transnistria.

Pressed on whether Obama was managing to punish Putin, Blinken claimed that the Russian president had already seen "a real cost" economically, and that the US president would continue working to "bring the world together in support of Ukraine, to isolate Russia" on a visit to Europe next week.

"We see investors looking at Russia and sitting on the fence, because they are looking for three things - they are looking for stability, looking to see if the country makes good on its international agreements, and to see if the country is integrated with the world economy," said Blinken.

"On all three of those areas Putin holds tremendous doubts, and we have extended those doubts."

However, Rogers, a Michigan Republican, said "I don't think the rhetoric matches the reality on the ground" and called for increased US action in support of Ukraine to allow those potentially in Putin's sights to "protect and defend themselves".

"We're talking about small arms so they can protect themselves. Maybe medical supplies, radio equipment ... defensive-posture weapon systems," said Rogers.

Asked if the White House would consider direct military aid, Blinken said: "All of that is under review."

Meanwhile, the former Republican presidential candidate Mitt Romney said that President Barack Obama could have done more to persuade Russia not to annex Crimea.

During the 2012 presidential race, Romney took criticism from Obama for saying Russia was America's "number one geopolitical foe" not al-Qaida. Now Romney has told CBS's Face the Nation that Obama's "naivete" and "faulty judgment" about Russia has led to a number of foreign policy challenges. Romney said the US should have worked sooner with allies to make clear the penalties that Russia could have faced if it moved into Ukraine.

EU Observer
March 22, 2014
Russia to Europe: We can do whatever we want
By Valentina Pop
[You can see interview with Vladimir Chizov here]

Brussels - Foreign policy debates are usually a polite affair. Ideas may clash, but the exchange rarely gets personal.

This was not the case on Friday (21 March) during the "Brussels Forum", an annual gathering of European and American politicians and experts, including the Russian ambassadors to the EU and Nato.

The Estonian President, Toomas Ilves, complained about the EU "sitting and watching" while Russia annexed Crimea and giving Moscow "a minor slap on the wrist" by blacklisting a few dozen people, a reaction which Russia "laughed at".

The Italian foreign minister, Federica Mogherini, who was defending the EU decisions, snapped: "So let's bomb Russia? What is the solution?"
Ilves retorted: "We should begin defending ourselves, because once you start going in this direction [annexation of territories], what possible intellectual reasoning could say 'this won't continue'?"

The Russian ambassador to the EU, Vladimir Chizhov, defended what he called the Russian "intervention" in Crimea, saying the crisis had started earlier, when Ukraine slipped into "deep political and economic problems" and risked turning into a "failed state".

Ilves said Chizov was being "disingenous" because "you can't destabilise a country and then express concern that it's a failed state".

Mikheil Saakashvili, the former president of Georgia at the time of Russia's last "intervention", its 2008 invasion, said he had "no respect" for Chizov, who reminded him of a character from Dr Strangelove, a Cold War satire directed by Stanley Kubrick in 1964.

On a separate panel, Nato secretary general Anders Fogh Rasmussen cornered the Russian ambassador to Nato, asking why Russia is not respecting the international principle it subscribed to in 1999 - that each country has a right to freely decide on its international alliances.

"This is true, but there is also the international law enshrining the principle of indivisibility of security. Nobody will improve their security at the expense of the security of others. Nato is free to take any decision. And Russia is free to take any decision to protect its legitimate security interest," the Russian ambassador, Alexander Grushko, said.

"From the beginning, we said that if Nato will go on with enlargement, it will continue producing new dividing lines, moving dividing lines towards the Russian borders. We also said that in some cases, these dividing lines will cross inside countries. It's up to you if you listen or not," he added.

Rasmussen continued his grilling: "Would you accept Georgia's right to choose Nato membership if this is a Georgian deision and if Nato accepts that? Would you accept that?"

Grushko replied: "We are against, we believe that this is a huge mistake. This is the position of my country."

The Russian ambassador also said that instead of focusing on "how to show its muscles" militarily, Europe should focus on the rights of Russians in the Baltic states, where hundreds of thousands are denied citizenship "just because they speak Russian".

"I think it would be a better solution than to send US [missile defence] interceptors," he noted.

Meanwhile, senior figures who had dealt with Russian leader Vladimir Putin during their career warned of the consequences of letting him get away with the annexation of Crimea.

With Putin knowing that Nato will not go to war over Ukraine or Georgia because they are not members of the alliance, Former Nato chief Jaap de Hoop Scheffer said Moldova may be next on Putin's list.

"Let's not forget Moldova, because the next stop might really be Transnistria," he said.

The former ambassador of the US to Nato, Kurt Volker, warned that the dismemberment of Ukraine sets a terrible precedent after it unilterally gave up its nuclear arsenal.

"After Russia's incursion in Ukraine, no country will give up nuclear weapons in return for territorial guarantees," Volker said.

In the aftermath of the Soviet Union's collapse, in 1991, the newly independent Ukraine had on its territory the world's third largest nuclear arsenal, larger than those of Britain, France, and China combined.

Five years later, it handed over all its nuclear warheads to Russia for dismantling, after having signed a memorandum in Budapest with the UK, Russia, and the US pledging to respect Ukraine's territorial integrity.

US President Barack Obama did tell Putin he is in violation of this Budapest memorandum. But both Washington and London are excluding the "military option" in reaction to Russia's actions in Ukraine.

Contacts say the furthest they might go is arming the Ukrainian military, which according to its foreign minister, is preparing to defend itself in case of attacks beyond Crimea.

Euromaidan PR
March 23, 2014
Delayed invasion/May Gambit - Thoughts from Kyiv on 22 March 2014
By Mychailo Wynnyckyj, PhD, Kyiv-Mohyla Academy

Is an invasion of eastern Ukraine by Russian troops imminent? This seems to be the question on everyone's mind tonight. Canadian Prime Minister Stephen Harper alluded to such a possibility during his press conference with Ukrainian PM Yatseniuk in Kyiv today. Yesterday, the US Embassy in Kyiv issued an updated travel warning: "The Department of State warns U.S. citizens to defer all non-essential travel to Ukraine and to defer all travel to the Crimean Peninsula and eastern regions of Kharkiv, Donetsk and Lugansk due to the presence of Russian military forces in the Crimean Peninsula, and in Russia near the Ukrainian border."

I have been guilty of wrongly predicting an imminent invasion before, so I will not fall into the same trap twice. Previously, my fear was based on a scenario (that I believe was planned and foiled) involving the deligitimization of Kyiv's post-revolutionary government via a court ruling scheduled for March 19; the case was ruled to be outside of the High Administrative Court's jurisdiction, and therefore dismissed. Regardless of questions that I may have as to the real independence of the court (prima fascae it would seem that the decision was politically motivated rather than grounded in law), in this case I was relieved by the ruling.

Tonight, the mood in Kyiv is calmer than it was several days ago. At the same time, the news reports emanating from Crimea are angering many. Several Ukrainian naval vessels and military bases have already been stormed by Russian forces, and practically all Ukrainian military installations have been surrounded with ultimatums issued to troops to surrender or face attack. The patience of the public, and its support for the government's policy of restraint in the face of open Russian aggression, are being strained by what are now being seen as signs of weakness, indicisiveness, and betrayal.

Events in Crimea are clearly tragic, but the question remains: will Putin continue or stop? I answer this question with the following: eventually - yes; short-term - no. By "short-term - no" I mean that the Kremlin will likely not move troops into Ukraine during the next 3-4 weeks. However, sabotaging the Ukrainian Presidential election scheduled for May 25 (in my opinion) remains a high priority for Putin, and this eventuality needs to be prepared for. I will deal with the "May scenario" at the end of this post, but first some words as to why I believe Russia will not invade mainland Ukraine in March and during the first half of April.

Thanks to the vigilance of Ukraine's Security Service, armed subversives in Odesa, and the leader of the "Narodnoe Opolcheniye" pro-Russian paramilitaries in Donetsk, were arrested today. It would seem that Putin's plans to instigate social unrest in Ukraine's southern and eastern regions during the next few days have been partially foiled. The pro-Russia demonstration in Kharkiv gathered a mere 300-500 participants today. In Donetsk 2-3 thousand pro-Russia demonstrators gathered, but a similar number of Ukraine supporters also came out. Without a semblance of local support, Putin is unlikely to try to move forces across the border. After all, he justified intervention in Crimea on the basis of protecting the interests of Russian-speakers and compatriots; if no such need for protection can be visibly demonstrated, the Russian President will have no excuse to invade. One could argue that Putin needs no credible excuse, but without even an incredible one, I think the likelihood of invasion is low. Much to the Kremlin's chagrin, the majority of ethnic Russians and Russian-speakers in Ukraine's east (not to mention the ethnic Ukrainian majority of the population) have shown that they simply do not want to be part of Russia.

At this point, having achieved his interim goal of annexing Crimea, Putin needs to take stock of what he has "accomplished" since beginning his intervention in Ukraine on Feb 27. It would seem that much has gone wrong:

   1. The Ukrainian military in Crimea did not succumb to violence (despite troops being repeatedly provoked), and instead surrendered their positions in protest, but without active fighting that would have provoked a "Ossetia scenario" according to which Russian troops were to have invaded in apparent self-defense
   2. The Russian invasion of Crimea was not greeted as a "liberation" by the population of Ukraine's eastern and southern regions; they did not proclaim their desire for increased autonomy en masse, as Putin may have expected
   3. The international community did not abandon Ukraine, and indeed Ukraine achieved a massive diplomatic victory in the UN and beyond with Russian aggression being universally condemned; the West has now imposed unprecedented economic sanctions against Russia, and eventually these will hurt Putin.
   4. The Kremlin's investments in communication channels designed to propagate its version of events (e.g. Russia Today) initially provided significant gains in the information war, but Ukraine's diaspora resources, and the moral authority resulting from its government's policy of restraint, have gradually leveled the initial Russian advantage in the West, and even (to a very limited extent) within Russia.

The above are likely to lead to a reevaluation of the Kremlin's strategy in Ukraine. On the Ukrainian side, preparations for armed conflict on the mainland are ongoing. Last week, Ukraine's Parliament passed a mobilization law, according to which all able bodied personnel who have previously served in the armed forces (i.e. experienced reserves) are to be called back within 45 days. The Secretary of the National Security Council has assured the public that this mobilization will be much quicker. The Parliament also passed changes to the state budget allocating an additional 7 billion UAH (approx. 800 million USD) to the military - according to Finance Minister Shlapak, these funds will be used to mobilize and train an additional 43 900 reservists. He also assured Parliament that regardless of deficits or other budget issues, funding for the military would be found under any circumstances.

To be honest, the Ukrainian Armed Forces are in a sorry state. According to reports from young men called up in the context of the mobilization law, they have been asked to report for training with their own food and sleeping bags. News reports commonly show local residents in Ukraine's eastern regions bringing food and supplies to army camps quickly established after mobile forces were deployed there from their home bases this week. Although on paper the Ukrainian army seems to possess sufficient tanks, artillery and weapons to be able to withstand a frontal attack (given that Russia, which has military commitments in other regions, could only afford to deploy 25-30% of its forces in Ukraine in the event of invasion), the state of this equipment and the level of training of military personnel leaves much to be desired. Many in the US have scoffed at Obama's proposal to provide ready-to-eat-meals to Ukraine as a support measure, but this offer may not be as laughable as would seem at first glance. Gas and diesel for tanks and APC's is also required - as shown by last week's gracious gesture from Ukraine's third richest oligarch (and newly appointed governor of Dnipropetrovsk oblast) Ihor Kolomoyskiy, who sponsored the purchase of fuel for all Ukrainian forces stationed in Dnipropetrovsk and Zaporizhzhya.

It would seem that this week's annexation of Crimea by the Russian Federation has finally cured the "ostrich syndrome" that has been plaguing many of my Ukrainian friends of late. During the past few weeks, whenever I have mentioned the prospects of a Russian invasion of mainland Ukraine, beyond Crimea, or have mentioned the possibility of casualties in Kyiv, many have simply refused to listen. My friends would end the conversation with "that's just too awful to even think about", and would (so I thought) stick their proverbial heads in the sand, hoping the danger will go away. The other day, a friend of mine who runs regional operations for a major Ukrainian bank, sensing my exasperation, corrected me: apparently, when an ostrich feels threatened, it does not actually stick its head in the sand; it freezes, lowers its head, and waits until the right moment to viciously fight back. At some point during this past week, the "right moment" seems to have arrived: Ukrainians have commenced rapid preparations to viciously fight back.

In January, at the height of the stand-off in Kyiv between protesters and the Yanukovych regime, the running joke on Maidan sounded something like this: "it takes an average Ukrainian man 3 months to put up a shelf in his bathroom, but 3 hours to build an impenetrable barricade." There's something to be said for Cossack genes I guess: suffer serfdom patiently, but once it's time to fight, the "ostrich" raises its head and (according to Wikipedia) "kicks forward with its powerful feet, armed with long claws, which are capable of disemboweling or killing a person with a single blow".  I'm not suggesting a single blow will be enough to stop Russian aggression when it comes, but I truly believe Putin may be in for a surprise once his troops cross the border. Unlike in Crimea, if an attack comes from the east, restraint will not be the policy of the day.

But will Putin actually attack? I have written previously about my take on Putin's motives with respect to Ukraine: they are not geostrategic or economic, but rather - ideological. In my opinion, the master of the Kremlin is motivated by a combination of expansionist (imperialistic) nationalism and a deeply rooted fear (irrational aversion) of Ukraine's Maidan, and the direct democracy that it represents. On the one hand, Putin is a righteous imperialist (in the sense of Rudyard Kipling), driven by a messianic vision of himself as the "gatherer of Russian lands", crusader against "western degeneracy", propagator of Eurasian values rooted in Orthodoxy and Russian exceptionalism (see the writings of Alexander Dugin for more details on this ideology). On the other hand, Putin sees his "third Rome" (and his own authoritarian power structure) threatened by the spread eastward of globalism, NATO, the EU, US cultural hegemony, and of the rights based discourse that Kyiv's Maidan embodies. Staging a "little war" has been a strategy that Putin has used in the past to prop up his popularity at home, and given both ongoing and foreseen problems in the Russian economy (the ruble devalued by 10% in January, Iranian oil became available to world markets in February), the time for a prop-up was probably right. Ukraine was/is a logical target for such a popularity stunt both because it is justifiable based on a historical myth that has been propagated in Russia for generations, and because the Ukrainian revolution was extensively demeaned by the Russian media during the previous 3 months.

Given such motivations, it is unlikely that economic sanctions and political isolation - no matter how painful or drastic - will stop the Kremlin. Indeed, sanctions may provide a convenient excuse for Putin to justify economic problems that are sure to emerge during the coming months: using revived Soviet tactics, the Russian media will spin the story according to which citizens' hardship has been caused by the imperialist West. Putin's countrymen see him as righteous, and many Russians seem to be prepared to suffer for the sake of realizing his vision of their country's "greatness". The fact that this "greatness" is in fact a manipulative image that has been foisted upon them so as to maintain Putin's hold on power is either not realized by the average Russian, or (worse) is realized and accepted.

I think it is important to understand that we are not just dealing with a mentally unstable dictator by the name of Vladimir Putin. Speeches made by Ambassador Churkov in the UN, my debate last Sunday on Al Jazeera's "Inside Story" with former Russian diplomat Vyacheslav Matuzov, and the Facebook posts of Roman Kokorev - Russia's official representative in the Council of Europe, all point to the fact that Putin's Eurasian expansionist ideology enjoys significant support in the Russian elite. Putin's popularity has soared in the aftermath of the Crimean annexation; on March 12, a letter of support for the Russian President's Ukraine policy was signed by 85 prominent Russian musicians, artists, actors, and performers.

Now, let's consider Russia's plans. The following map was published in an article that argued that Putin's interests in Ukraine are economic - driven by a desire to grab and control energy resources in Ukraine's east and south. I am skeptical of this argument, but nevertheless, the map provides an excellent representation of the geography of the Kremlin's appetites. Putin's plan for the area shaded in Orange seems to involve creating an Abkhazia/TransDniestria styled buffer zone between the Russian Federation and the rest of Ukraine. This area is unlikely to be annexed to Russia. However, its existence as an unrecognized and unstable, nominally independent, political entity that separates Russia from "fascist Ukraine" (the term used by the Kremlin to describe Kyiv and the western regions) is clearly in Putin's interests. It is this area that must become the focus of the Kyiv government's defensive activities during the coming 4-6 weeks.

In less than 7 weeks, Russia and Ukraine will hold Victory Day celebrations - held on May 9 throughout the former Soviet Union (except the Baltic states). This year, the Kremlin is sure to make a big deal of the fact that 2014 is the 70th anniversary year of the liberation of Ukraine from Nazi forces (the last battle on Ukrainian soil occurred on 28 October 1944). Traditionally, orange and black commemorative "St. George ribbons" are worn on May 9 - the same ribbons that the pro-Russia demonstrators in Crimea and Ukraine's eastern provinces have adopted as their symbol. It is likely therefore that the Victory Day celebrations will provide excellent television images to be used as a pretense to show mass support for "unity with Russia" in the eastern and southern oblasts - i.e. just the excuse that Putin will be looking for to move in.

Under these circumstances it is crucial, in my opinion, that the Kyiv government organize large scale demonstrations commemorating Victory Day as a distinctly Ukrainian celebration. Tanks and armored vehicles should be paraded through the main streets of Kyiv, Donetsk, Kharkiv and Odesa with marching bands, large numbers of soldiers, and veterans. Fly-by's by military aircraft would add pomp to the ceremonies. These parades must fly the Ukrainian flag in immediate proximity to the Red Army standard. And to the distaste (perhaps) of western Ukrainians and Svoboda/Right Sector supporters, UPA (Ukrainian Insurgent Army) symbolism must be inconspicuous if present at all. The goal will be to demonstrate both strength, and an alternative (to the Kremlin's) historical myth of Russian and Ukrainian unity "tied by blood", with a presentation of WWII as a primarily Ukrainian war (as it was if one counts real casualties and deaths).

Although I realize the following will be controversial, I believe that this year's Victory Day commemorations in Ukraine should be attended and supported by large delegations from Ukraine's worldwide diaspora and by western political leaders. Make no mistake: the above is both a specific proposal and unofficial request.

A little more than 2 weeks after Victory Day (May 9), the post-revolutionary Ukrainian government has scheduled the first round of Presidential elections (May 25). Putin cannot afford to allow this election to take place, and will do everything possible to destabilize Ukraine's eastern regions in the final days of the campaign so as to force a cancellation (or at least discreditation) of the vote. It would therefore be highly beneficial if a grand scale commemoration of the 70th anniversary of the "liberation" of Ukraine could be organized - with large numbers of ethnic Ukrainian international guests voicing their solidarity with Donetsk, Kharkiv, Luhansk and Odesa on this day. These cities should feel the full weight and support of the global Ukrainian community, and of Ukraine's international partners.

I fully realize that my proposal is highly problematic. After-all, most Ukrainians residing abroad are (like me) descendants of western Ukrainian emigres for whom the advance of Soviet forces through Ukraine in 1944 was the catalyst for flight westward. However, for those who did not emigrate (and particularly for residents of Ukraine's eastern and southern regions), the advance of the Red Army through Ukraine in 1944 is remembered as a heroic struggle for liberation. The fact that the army was commanded by Stalin was of secondary concern: the soldiers were fighting for their homes, their families, their land.

I have no doubt that this year, Putin's propaganda machine will present the 1944 advance of the Red Army to the Polish border as a joint victory of Russia and Ukraine. It is Ukraine's task to use this commemoration as an opportunity to both heal internal historical wounds, and to tie the people together in a common cause against an external enemy.

Given the above, I am particularly concerned by media reports tonight suggesting that Ukraine's Minister of Culture (Yevhen Nyshchuk - the former "voice of Maidan") has tabled a proposal to cancel the traditional May 1-2 state holidays, and to move the May 9 commemoration to May 8, simultaneously renaming the date into "Soviet atrocity memorial day". A more divisive proposal in today's political context would be difficult to imagine. And under the current circumstances, such ideas must not gain popular support. I'm afraid that if they do, Ukraine will lose its eastern and southern regions just as it has de facto lost Crimea.

I am often asked by my diaspora friends "how can we help Ukraine?" Well, here's a very concrete idea: come celebrate Victory Day in Donetsk (and stay to observe the elections)! To some this proposal will sound a little crazy; to others - adventurous.

Adventurously yours...

Window on Eurasia: Russians Must Oust Putin Rather than Suffer for His Imperial Ambitions, Felshtinsky Says
Paul Goble

            Staunton, March 24 - Russians must recognize that Vladimir Putin is "an aggressor and instigator of war," that he is making them into "victims and participants in state crimes," that he will eventually lose to the democratic world, and that he, they and their country will suffer and be held accountable just as the Germans were after 1945, according to Yury Felshtynsky.
         The distinguished Russian historian says that Russians must understand that the democratic world will once again be slow to react but that as in the past, once it does so, Russia will not be able to withstand it. And thus they must conclude that "if [they] want to live, [they] need to get rid of Putin" and soon (
            "The time has come," the historian says, "to open one's eyes and call things by their own names."  Many are reluctant "to call Putin the Hitler" of today, largely because until March 2014 and despite blowing up apartment houses in 1999, the new war in Chechnya, the suppression of freedom at home, and the war against Georgia, Putin considered it "important to remain a member of the European community."
            But "in March 2014, Putin crossed the Rubicon." He wrote himself out of the European and world communities by showing that for him, "the national or more precisely nationalistic and geopolitical interests of Russia as [he] sees them" are more important to him than the financial interests of the country.
            Putin today "views Russia exclusively as a new empire rising from the ruins" and himself as the author of this development, Felshtynsky says.
            The Kremlin leader is "an irresponsible and purely educated simplifier." He doesn't know history very well, and that is what German Chancellor Merkel was referring to when she said that "the president of Russia lives in another world." He is trapped in the values of the nineteenth and early twentieth centuries when states regularly seized territories.
            In 1853-1856,  Russia fought a war in the Crimea and it lost.  Today, Putin thinks he can achieve a different outcome.  He "speas with the world from a position of strength just as Hitler did at one time.  But Hitler despite everything operated in an alliance with Italy and Japan, and as of August 1939 in a union with Stalin." And despite that, "he lost everything."
            In its seizure of Crimea, Russia is in "absolute isolation." No country, except its dependent clients and a few interested in attracting attention, supports it. Even China which might be expected to back Moscow has limited itself to "polite neutrality."
            "The analogy between March 1938 when Hitler first seized Austria and then, in September of the same year, the Suddentland, and Crimea which Putin occupied in March 2014 is so obvious that comparison of Putin and Hitler have not disappeared from the newspapers and the mouths of political and social activists. Even Hillary Clinton compared Putin with Hitler."
            But the most important question is not whether Putin is Hitler and whether he has or will follow in the German dictator's footsteps. The question, Felshtynsky says is what those who know the history of Hitlerism can expect and should do. If the world had stopped Hitler in September 1938 or even March 1939, he would have had a much less tragic influence on the world than he did.
            Unfortunately the international community did not stop him, and it appears that "Putin will not be stopped either." Just like Hitler, Felshtynsky says, "Putin cannot stop" on his own. "Crimea cannot be the end of the nationalist and imperialist strivings of the Russian president for life."
    In 1938, he continues, "Europe chose to wait and do nothing. A year and a half later, after having yielded the remains of Czechoslovakia, it all the same was drawn into a war begun by Hitler," one in which he was faced with demands for unconditional surrender. "We know who won in this war and how Hitler ended. Germany and the Germans suffered defeat, a divided county and the Nurnberg trials."
Felshtynsky says that he expects that "the Nurnberg trial of Putin will take place in Sevastpol, and he suggests that if they are alive, the following people should join Putin in the dock as war criminals: Foreign Minister Sergey Lavrov, Putin's Ribbentrop, Defense Minister Sergey Shoygu, advisor Vyacheslav Surkv, Security Cuncil secretary Nikolay Patrushev, Russian fascist Dmitry Rogozin, and a number of others.
            And that tribunal will remember as well those who boosted Putin's imperialist grab in the media or who remained silent in the face of his violation of international law.  They may be riding high now, but "we will remember all of them ... somewhat later ... when we win" and they are in the dock.
                March 2014 confronted the democratic war with the same difficult choice it faced before World War II: to begin war with Putin now or later after "concluding a global anti-Russian international accord and isolating Russia by introducing all possible sanctions" and waiting "while doing nothing in the hopes that something will change."
            "Unfortunately," things aren't going to change in the direction the West hopes, the historian says and then predicts, on the basis of what happened in the 1930s, that the third world war will begin in September 2015, 18 months from now.
            "We will win in this war because Russia is not in a position to conduct it against all humanity," he says. And as a result of this war, "there will be a disintegration of the Russian Federation in comparison with which the collapse of the Soviet Union in 1991 will seem a modest repetition before a premiere."
            It certainly does not appear that there are sufficient "internal forces" in Russia to "block this approaching catastrophe," Felshtynsky says. But Russians need to reflect on what the likely future course of events means for them: Putin is drawing them into a war and making them victims or co-conspirators of his campaign.
            And they need to begin asking themselves: "Are you prepared to die for Putin's imperil ambitions?" Russia will lose Putin's war because the democratic world will not lose this fight, at least not at the end.  It and not Russia will come out the victor. "If you want to live, get rid of Putin!"
New York Times
March 24, 2014
Confronting Putin's Russia
Michael A. McFaul, a Hoover fellow at Stanford, served for five years in the Obama administration, as a special assistant to the president at the National Security Council and as ambassador to the Russian Federation.

The decision by President Vladimir V. Putin of Russia to annex Crimea ended the post-Cold War era in Europe. Since the late Gorbachev-Reagan years, the era was defined by zigzags of cooperation and disputes between Russia and the West, but always with an underlying sense that Russia was gradually joining the international order. No more.

Our new era is one defined by ideological clashes, nationalistic resurgence and territorial occupation - an era in some ways similar to the tragic periods of confrontation in 20th-century Europe. And yet there are important differences, and understanding the distinction will be critical to a successful American foreign policy in the coming decades.

We did not seek this confrontation. This new era crept up on us, because we did not fully win the Cold War. Communism faded, the Soviet Union disappeared and Russian power diminished. But the collapse of the Soviet order did not lead smoothly to a transition to democracy and markets inside Russia, or Russia's integration into the West.

Some Russians pushed forward on this enormous agenda of revolutionary change. And they produced results: the relatively peaceful (so far) collapse of the Soviet empire, a Russian society richer than ever before, greater protection of individual rights and episodically functioning democratic institutions.

But the simultaneity of democracy's introduction, economic depression and imperial loss generated a counterrevolutionary backlash - a yearning for the old order and a resentment of the terms of the Cold War's end.

Proponents of this perspective were not always in the majority. And the coming to power of an advocate of this ideology - Mr. Putin - was not inevitable. Even Mr. Putin's own thinking changed over time, waffling between nostalgia for the old rule and realistic acceptance of Russia's need to move forward.

And when he selected the liberal, Western-leaning Dmitri A. Medvedev as his successor in 2008, Russia's internal transformation picked up the pace. Though Russia's invasion of Georgia in 2008 isolated Russia for a time, its integration into the existing international order eventually regained momentum.

In my first years in government, I witnessed President Medvedev cooperating with President Obama on issues of mutual benefit - a new Start treaty, new sanctions against Iran, new supply routes through Russia to our soldiers in Afghanistan and Russian membership in the World Trade Organization. These results of the "reset" advanced several American vital national interests. The American post-Cold War policy of engagement and integration, practiced by Democratic and Republican administrations alike, appeared to be working again.

When Mr. Putin became president again in 2012, this momentum slowed, and then stopped. He returned at a time when tens of thousands of Russians were protesting against falsified elections and more generally against unaccountable government. If most Russians praised Mr. Putin in his first two terms, from 2000 to 2008, for restoring the state and growing the economy, some (not all) wanted more from him in his third term, and he did not have a clear response.

Mr. Putin was especially angry at the young, educated and wealthy protesters in Moscow who did not appreciate that he (in his view) had made them rich. So he pivoted backward, instituting restrictions on independent behavior reminiscent of Soviet days. He attacked independent media, arrested demonstrators and demanded that the wealthy bring their riches home.

In addition to more autocracy, Mr. Putin needed an enemy - the United States - to strengthen his legitimacy. His propagandists rolled out clips on American imperialism, immoral practices and alleged plans to overthrow the Putin government. As the ambassador in Moscow, I was often featured in the leading role in these works of fiction.

The shrill anti-Americanism uttered by Russian leaders and echoed on state-controlled television has reached a fanatical pitch with Mr. Putin's annexation of Crimea. He has made clear that he embraces confrontation with the West, no longer feels constrained by international laws and norms, and is unafraid to wield Russian power to revise the international order.

Mr. Putin has made a strategic pivot. Guided by the right lessons from our past conflict with Moscow, the United States must, too, through a policy of selective containment and engagement.

The parallels with the ideologically rooted conflicts of the last century are striking. A revisionist autocratic leader instigated this new confrontation. We did not. Nor did "Russia" start this new era. Mr. Putin did. It is no coincidence that he vastly weakened Russia's democratic institutions over the last two years before invading Crimea, and has subsequently moved to close down independent media outlets during his Ukrainian land grab.

Also, similar to the last century, the ideological struggle between autocracy and democracy has returned to Europe. Because democratic institutions never fully took root in Russia, this battle never fully disappeared. But now, democratic societies need to recognize Mr. Putin's rule for what it is - autocracy - and embrace the intellectual and normative struggle against this system with the same vigor we summoned during previous struggles in Europe against anti-democratic governments.

And, as before, the Kremlin has both the intention and capacity to undermine governments and states, using instruments like the military, money, media, the secret police and energy.

These similarities recommend certain policy steps. Most important, Ukraine must succeed as a democracy, a market economy and a state. High on its reform list must be energy efficiency and diversification, as well as military and corruption reforms. Other exposed states in the region, like Moldova and Georgia, also need urgent bolstering.

Also, as during the 20th century, those states firmly on our side must be assured and protected. NATO has moved quickly already, but these efforts must be sustained through greater placement of military hardware in the front-line states, more training and integration of forces, and new efforts to reduce NATO countries' dependence on Russian energy.

And, as before, the current regime must be isolated. The strategy of seeking to change Kremlin behavior through engagement, integration and rhetoric is over for now. No more membership in the Group of 8, accession to the Organization for Economic Cooperation and Development or missile defense talks. Instead there must be sanctions, including against those people and entities - propagandists, state-owned enterprises, Kremlin-tied bankers - that act as instruments of Mr. Putin's coercive power. Conversely, individuals and companies not connected to the government must be supported, including those seeking to take assets out of Russia or emigrate.

Finally, as during World War II and the Cold War, the United States and our allies can cooperate with Mr. Putin when our vital interests overlap. But this engagement must be understood as strictly transactional, and not as a means to pull Russia back into accepting international norms and values. That's how he will see this engagement. So should we.

For one thing, unlike Communism or even fascism, Putinism has little appeal beyond Russia. Even inside Russia, brave civil society leaders still defy autocracy, war and nationalist fervor, and have managed to mobilize tens of thousands against Mr. Putin's intervention, while a larger but quiet section of society will lament the advent of this new era.

I met these silent skeptics - in government, business and society - every day in my last job. Citizens rally round the flag during crises, and propaganda works. But Mr. Putin's nationalism is fueled primarily by a crude, neo-Soviet anti-Americanism. To continue to spook Russians about American encirclement and internal meddling will be hard to sustain. They are too smart.

Second, Mr. Putin's Russia has no real allies. We must keep it that way. Nurturing Chinese distance from a revisionist Russia is especially important, as is fostering the independence of states in Central Asia and the Caucasus.

Another difference is that Russian military power is a shadow of Soviet might. A new global conflict is unlikely. But Russia's military can still threaten Russian border states, so Europeans must bolster their defenses, and Western governments and companies must stop assisting Russia's military modernization.

One obvious difference is that the Internet did not exist during the last standoff. Recent Kremlin moves to cut off citizens from independent information are disturbing, but the communications revolution ensures that Russians today will not be as isolated as their grandparents.

Greater exposure to the world gives Russians a comparative analysis to judge their situation at home. This is a powerful tool, which needs to be nurtured through educational exchanges, peer-to-peer dialogues and increased connectivity between the real Russian private sector and its international partners.

But there are two important differences that weaken our hand. First, the United States does not have the same moral authority as it did in the last century. As ambassador, I found it difficult to defend our commitment to sovereignty and international law when asked by Russians, "What about Iraq?" Some current practices of American democracy also do not inspire observers abroad. To win this new conflict, we must restore the United States as a model.

Second, we are enduring a drift of disengagement in world affairs. After two wars, this was inevitable, but we cannot swing too far. As we pull back, Russia is pushing forward. Leaders in Congress and the White House must work together to signal that we are ready to lead the free world in this new struggle.

The United States - together with Russians who want to live in a prosperous and democratic Russia - will win this new conflict in Europe. Over the last century, democracies have consolidated at a remarkable pace, while autocracies continue to fall. Especially in educated, rich, urban societies like Russia, democracy eventually takes hold. A democratic Russia will not always define its interests as we do, but will become a more stable partner with other democracies.

We cannot say how long the current autocratic government in Russia will endure. But a sober, realistic strategy to confront this new threat will help to shorten the tragic era we just entered.

Moscow Times
March 24, 2014
We Will Stop Russian Aggression in Ukraine
By Oleh Tyahnybok

Oleh Tyahnybok is the leader of Ukraine's Svoboda party, one of three main parties that compose Ukraine's governing coalition, and a member of the Verkhovna Rada.

It is beyond our understanding how Russia can legitimize occupying another state's territory without any legal grounds, organize an unconstitutional "referendum" in an occupied territory that no country recognizes and send its citizens to organize provocations in the eastern regions of Ukraine on a regular basis. What's more, Russia is now trying to become a third party in the settlement of the conflict it initiated.

Ukraine is not the aggressor that initiated a war against another state. It does not require "oversight" or dominance. Virtually the entire world is united in its condemnation of Russia's aggression and that its hostile actions are a destabilizing factor in Ukraine.

Before constructive political dialogue can occur with Russia, the Kremlin must stop its aggressive intervention in the domestic affairs of Ukraine under the fabricated pretext of "protecting Russian citizens against Ukrainian extremism." Russia must stop supporting separatist activities in the eastern and southern regions of Ukraine.

It is difficult to comprehend what Russia hopes to gain by seeking recognition of the so-called referendum in Crimea. Ukraine's Constitutional Court has confirmed that this so-called "will of the people" was unconstitutional. The same opinion was expressed by the Venice Commission, 14 members of the United Nations Security Council and the European Union. The referendum was not monitored by any authorized representatives of individual countries or international organizations. Most Crimean Tatars boycotted the vote - and for good reason. Under such circumstances, Russia's demands for recognition have no foundation whatsoever.

Against this background, it is worthwhile to recall examples of Russia's previous attempts to find "peaceful settlements" of frozen conflicts in regions such as the self-proclaimed Transdnestr republic, Nagorno-Karabakh, Abkhazia and South Ossetia.

Clearly, Russia is driven by realpolitik to preserve and expand these frozen conflicts, which are the Kremlin's trump card. Yet all civilized countries should understand that such geopolitical games pose a serious threat not only to the immediate conflict in the region, but also to the global balance of power.

We were surprised to hear Russia's concerns about the spread of neo-Nazi ideology. Ukrainian extremist laws prohibit political movements and actions aimed at inciting ethnic hatred. Perhaps Russia should look at the neo-Nazi accusations from a different angle: the March 17 referendum in Crimea resembles the Nazi Anschluss of Austria in 1938. The intervention of troops in the territory of a sovereign state, under the pretext of protecting citizens' rights, is an amazing historical coincidence resembling the Nazi annexation of Czechoslovakia's Sudetenland in 1938.

Regarding the idea of federalization, this structure suits Russia, where in some regions ethnic minorities make up a majority of the population such as Tatarstan, Kalmykia, Ingushetia, Buryatia and others. The idea of Ukrainian federalization is nothing more than another underhanded attempt to weaken Ukrainian statehood and subordinate Ukraine to Putin's geopolitical ambitions. Moreover, we see the attempt to impose any system of government on the sovereign country of Ukraine as a continuation of intervention in our internal affairs and we advise Russia to once again review Article 2 of the UN Charter establishing the sovereign equality of all members.

Ukraine guarantees the rights of all ethnic minorities. Meanwhile, Russia tries to use "humanitarian concerns" as a pretext to justify its own expansion: cultural, religious and ultimately military. Russia claims it is "intervening to protect its citizens" in Ukraine, but there is little, if any, proof of human rights violations against Russians.

It is the government's sovereign right to keep Ukrainian the only official language in the country. After all, Ukrainians make up nearly 80 percent of the country's population. We will not bend to pressure from President Vladimir Putin and his continued policy of Russification, which first began under the tsars and continued throughout the Soviet era.

Russia proposes that we ban state interference in religious affairs and interfaith relations in the new Ukrainian Constitution. We would like to propose to Russia's leaders to reduce the interference of the Moscow Patriarchate Church in internal Ukrainian affairs. Notably, every visit by Patriarch Kirill is accompanied by poorly disguised calls for political union with Russia.

Russia wants to become a "security guarantor" of the new Ukrainian government. After Russia's brazen military intervention in Ukraine, any talk of "security guarantees" is a farce. Russia has flagrantly violated its obligations of the 1994 Budapest Memorandum and other bilateral agreements that guaranteed Ukraine's territorial integrity. Therefore, it is obvious that we need to find a more reliable security model for Ukraine.

Russia's proposals constitute a direct threat to the existence of Ukrainian statehood. Under no circumstances will Ukraine accept Russia's unreasonable demands.

Russia Slams Robbery of Russian Train Passengers in Ukraine

MOSCOW, March 24 (RIA Novosti) - The Russian Foreign Ministry on Monday denounced as an act of anarchy the robbery of Russian passengers on board a train in Ukraine by ultranationalists last week.

On Friday, a group of uniformed men boarded a train from Moscow in the southwestern Ukrainian city of Vinnytsia under the pretext of an ID check.

"Passengers with Russian passports were forced to hand over their money and valuables. The robbery was accompanied by 'political brainwashing,'" the ministry said in a statement.

The men were wearing uniforms of a WWII-era nationalist group, the Ukrainian Insurgent Army (UPA), which was responsible for massacring thousands of Polish, Jewish and Russian civilians in western Ukraine during and after WWII.

"It seems as if the anarchy of the 20th century is being revived in Ukraine," the ministry said, adding that local police refused to listen to official complaints by Russian citizens.

Moscow has repeatedly expressed grave concern about the rise of ultra-right nationalism in Ukraine, especially in western regions where ultranationalist and anti-Russian sentiments are traditionally strong.

Last Tuesday, Russian President Vladimir Putin condemned the new government in Ukraine that came to power following the ouster of President Viktor Yanukovych last month, saying their seizure of power has allowed extremists to strongly influence the country's civil and political agenda.

Putin also said that Ukrainian "nationalists, neo-Nazis, Russophobes and anti-Semites" bore full responsibility for the civil crisis in the country, which prompted people of Crimea to vote in favor of seceding from Ukraine and rejoining Russia.

World Affairs Journal
March 20, 2014
'Experts' on Ukraine
By Alexander J. Motyl
ALEXANDER J. MOTYL is professor of political science at Rutgers University-Newark, as well as a writer and painter. He served as associate director of the Harriman Institute at Columbia University from 1992 to 1998.
[Svoboda program here]

An astoundingly large amount of nonsense has been written about Ukraine ever since it came to occupy center stage in the public mind. That's not surprising: most people in most countries barely knew the place existed or assumed it was "really" Russia. The number of Ukraine specialists outside of Ukraine is probably no greater than a few hundred in the entire world. Their expertise was of little interest to people who had no interest in or use for the country.

Now that Ukraine is in the news, it's equally unsurprising that non-experts with an abysmal knowledge of Ukraine are claiming to be able to speak authoritatively about it. Media that feature such people are doing their consumers an enormous disservice. No one would ask a plumber to speak about nuclear weapons or a nuclear physicist about plumbing. And yet it doesn't seem to occur to news outlets that Professor Stephen F. Cohen [1], a life-long specialist on Russia who has never written anything academic about Ukraine, might be unqualified to opine about Ukraine. Worse, it doesn't trouble Cohen, who has spent a good part of his distinguished academic career insisting that evidence and expertise are indispensable to genuine knowledge. Nor does ignorance of Ukraine keep Henry Kissinger from producing [2] a Washington Post op-ed that gets nearly everything wrong about the country.

Here's a rule of thumb for media, policymakers, and consumers of news. Before you listen to, read, or watch self-styled experts discussing this topic, first find out whether they read Ukrainian, or at least Russian, and whether they've actually written anything serious about Ukraine.

The latest two examples of such blather come from two professors, David Hendrickson [3] and Robert English [4]. Like Kissinger, they are specialists in international relations; their views on Ukraine's place in the world order might therefore be trustworthy. Naturally, neither evinces any deep knowledge of Ukraine's history, politics, or culture.

Both scholars set off alarm bells discussing the presence in Ukraine's government of several members of right-wing political organizations, Svoboda and the Right Sector. English even thinks that their presence is more dangerous than Vladimir Putin's invasion of Ukraine's southernmost province, Crimea. Both say these organizations are fascist.

One cannot help but wonder if either scholar has read any of the official Ukrainian-language statements or programs of either organization. For myself, I am fairly certain that neither has availed himself of the extensive academic literature on Ukrainian nationalism. Hendrickson cites one scholar, Per Rudling, whose views on Ukrainian nationalism are as extreme as Noam Chomsky's on American foreign policy. There's nothing wrong with reading Rudling (one suspects Hendrickson didn't read too closely, though, as he misspells Rudling's name twice), but, as any serious scholar and journalist knows, one should always familiarize oneself with a variety of perspectives.

Are Svoboda and the Right Sector fascist? Let's compare them to a bona fide fascist regime. Vladimir Putin's Russia is an authoritarian dictatorship that has a charismatic strong man as its undisputed leader, glorifies him in an unabashed personality cult, and employs hyper-nationalism and neo-imperialism as a source of legitimacy (more on that here [5]). These features are found in equal measure in Hitler's Germany and Mussolini's Italy, and we justifiably call regimes with such defining characteristics fascist. Unsurprisingly, such regimes are usually violent and intolerant of various minorities.

Now let's look at Svoboda [6] and the Right Sector [7]. Neither group supports authoritarian dictatorship or neo-imperialism. Svoboda aspires to the kind of "ethnocracy" found in Israel-a system of government that, while neither ethnically neutral (Israel is a Jewish state) nor as liberal as the ACLU might desire, is not undemocratic. The Right Sector professes to be more liberal than Svoboda and actually expresses a moderate form of nationalism, while Svoboda's has significantly diminished during, and possibly as a result of, the Euro Revolution. Both groups, while on the Maidan in Kyiv, actively and easily cooperated with Russian speakers and ethnic minorities. (Ukraine's Jewish leaders have not expressed alarm [8] at their presence in the revolution or government.)

Svoboda has a charismatic leader, Oleh Tyahnybok, but his chances of winning a presidential election and becoming a strongman are virtually nil. The Right Sector's leader, Dmytro Yarosh, lacks even Tyahnybok's charisma and has zero chances of becoming president. Neither movement envelops the leader in a personality cult.

Both Svoboda and Right Sector are on the right. They are decidedly not liberals-and some of them may be fascists-but they are far more like the Tea Party or right-wing Republicans than like fascists or neo-Nazis. I for one wouldn't want them to be setting the tone for Ukrainian policy. But neither would I want the Tea Party to be in charge of Washington. No less important, their role in the Kyiv government is at best tertiary (they would probably win no more than 5 percent of the vote in a national election), and policy is set not by them but by the broad coalition of unquestioned liberal democrats.

Should both groups be monitored? Of course. Might they evolve in a worrisome fashion? Possibly. But Hendrickson and English might be advised to direct most of their monitoring zeal at the activity of Putin and his fascist state. He invaded Ukraine. Neither Tyahnybok nor Yarosh has invaded Russia. Putin may start a land war with Ukraine. Both Tyahnybok and Yarosh will at most defend their country.

Who's the greater threat to Ukraine? Right-wing organizations such as Svoboda and Right Sector, who have a few hundred "fighters" at their disposal, or a full-fledged fascist such as Putin, who has 750,000 soldiers at his? You don't have to be an international relations expert to answer that question.

Voice of Russia
March 23, 2014
Ukrainians lay down three thousand weapons to police - Interior Minister

Some three thousand guns have been laid down to the Ukrainian police during the ongoing disarmament campaign, the Verkhovna Rada appointed Interior Minister Arsen Avakov said today at a government meeting.

"As of today, the Ukrainians have laid down some three thousand weapons. 54 Makarov pistols, seven Kalashnikov rifles and 58 grenades were returned to us yesterday in Lvov," Avakov said.

During the unrest in Ukraine around 15 thousand weapons were believed to be stolen from military depots.

Disquiet in Baltics over sympathies of Russian speakers
By Aija Krutaine and David Mardiste
March 24, 2014

DAUGAVPILS, Latvia/TALLINN (Reuters) - In the former Soviet republics of Latvia and Estonia, there is unease over events in Crimea, which was formally annexed by Moscow last week on the pretext of safeguarding its Russian minorities.

Russian news reports carried in Crimea had said Ukraine was being overrun by gangs of anti-Russian fascist thugs and that hundreds of thousands of Russian-speaking refugees had fled a "humanitarian catastrophe" in Ukraine, a claim for which no evidence has been found.

In the Latvian town of Daugavpils, where a Russian Tzarist-era fortress and barracks meet grey Soviet-era apartment blocks, you are more likely to be greeted in Russian than Latvian, with 51 percent of the city's residents Russians.

Russian speaker Irina Gorkina says the region, within two hour's drive of Russia's border, has never seen ethnic conflict.

She quickly knocks on the wooden table in front of her - three times - just in case.

"Not everything is smooth here. Not everything is right," said the 59-year-old, whose father was born in Latvia and mother in Russia. She complains about pensions and slow economic growth in the region. "But it's not only Russians who suffer from state policies; Latvians do, too."

Concern over the Baltics extends to Brussels.

"I mean if you are a Baltic country, where we have 40 percent of people speaking Russian, you are not very comfortable these days," said an EU official, who asked to remain anonymous.

"I would not be surprised if we are now going to see troops of some of our member states in some of these countries."

Russian speakers make up about 35 percent of Latvia's 2 million population. In Estonia, around a quarter of its 1.3 million people are Russian speakers. In neighbouring Lithuania, ethnic Russians make up about 6 percent.

The three Baltic states are all NATO members, and Lithuania will be the last of them to adopt the euro currency next year as the three lean towards the West, but they are also hugely dependent on energy from Russia and have strong trade ties.

Some fear their Russian enclaves could be geopolitical flashpoints, potentially manipulated by President Vladimir Putin to destabilise the region. Moscow has long complained about the rights of ethnic Russians in the Baltics.


Jurijs Zaicevs, a 26-year-old Daugavpils City Council member said "dissatisfaction in the Russian community is huge", mainly due to the issue of citizenship.

Thousands of Russians came over during the Soviet era to work in Baltic industries. But after 1991 independence, they were not granted automatic citizenship in the new republics. Many still hold on to Russian passports.

Many complain they feel like second-class citizens. About 270,000 Latvians do not have citizenship, cannot vote or apply for certain public sector jobs.

"We are non-citizens. They called us occupiers, but now they turn out occupiers themselves. This is Russia's land," said Marija, a Russian-speaking 80-year-old at the market in Daugavpils. She came to Latvia in the early 1950s.

In some of the worst unrest since independence, ethnic Russians in Estonia rioted in 2007 over the relocation of a Soviet-era Bronze Soldier victory statue. That was followed by cyber attacks on Estonian computers, which the government blamed on Russia.

There was disquiet when, as pro-Russian forces took up positions in Crimea, the Russian ambassador to Latvia offered Russian passports and pensions for ethnic Russians. Then a Moscow diplomat told the United Nations Human Rights Council in Geneva this month that "language should not be used to segregate and isolate groups", and Russia was "concerned by steps taken in this regard in Estonia as well as in Ukraine".

Latvians now want Russian speakers in the country to learn their language, which some see as a resurgence of Latvian nationalism. After more than half a century of living in the country, many Russian speakers only understand basic Latvian.

As in southern and eastern parts of Ukraine, they depend for their news on Russian media, largely controlled by the Kremlin, which worries Baltic governments. Lithuania last week banned a Russian TV channel for broadcasting "lies" about the country's history.

Some ethnic Latvians say Russian speakers were hostile to Latvia's adoption of the euro because of the influence of Russian media.

For all that, Marija Kokareva, a 20-something vendor at a market in the centre of Daugavpils, is the face of a new generation that sees Latvia as its motherland.

"I've spent my childhood in Latvia," she said in Russian. "I'm a Latvian citizen and would of course not want to separate from Latvia. We are proud of our country."


In Narva, one of Estonia's biggest cities, near the Russian border, where Russian speakers are a majority, there is some fellow feeling with the people of Crimea.

But the number of people with real nostalgia for the Soviet era is declining. A younger generation now has the Euro and the chance to travel freely in Europe.

"People in Narva can, of course, see across the river and see that life is not better in Ivangorod in Russia, so they are happy where they are," said Andres Kasekamp, a political science professor at Estonia's Tartu University.

Estonian film director Aljona Surzhikova has made several documentaries in the past decade on Estonia's Russian enclave.

"When we were filming in Narva 10 years ago, the youth were looking more towards St. Petersburg, but now they are looking towards Tallinn," she has been quoted by local media as saying.

Integration may be slow, but it is happening.

In Estonia, which uses the phrase "Our Russians" to describe ethnic Russians in the country, some of its best footballers are Russian. Konstantin Vassiljev's goals took Estonia to the qualifying round of the Euro football championship in 2012.

This year's Estonian entry for Eurovision, the continent's annual song contest, is for the first time, by an ethnic Russian singer, Tatjana Mihhailova.

Fjodor Dubinin, a Russian citizen who studied shipping in Riga and is now a pensioner in Daugavpils, said he doubted people were looking so much towards Moscow these days.

"I think that we won't be asking for help from Putin," he said. "We live well. Nobody says anything bad to me, and I don't do so (to others) either."

INSIGHT-Kiev woos oligarchs, bolstering east against Putin
By Alastair Macdonald

DONETSK, Ukraine, March 24 (Reuters) - Even as a new alarm sounds about it massing troops on the Ukrainian border, Russia may have missed its chance to exploit unrest in the Russian-speaking east to seize Ukraine's industrial heartland in the way it took Crimea.

A week after violence involving pro-Moscow separatists left three people dead in border cities, the outlines of a consensus have emerged between the new leaders in Kiev and the eastern business oligarchs allied to ousted president Viktor Yanukovich.

Cooperation between Kiev and the magnates in Yanukovich's native Donetsk and the wider Donbass coalfield would make it harder for Moscow to present any military intervention as humanitarian help and less likely it would be widely welcomed.

It follows a vow by Ukraine's new prime minister to decentralise power to the regions, safeguard Russian language rights and protect industries, a compromise Western diplomats have been pressing for to stop Ukraine breaking up.

Shortly after Yanukovich fell, parliament briefly moved to make Ukrainian the sole official language. That, and the inclusion of nationalists in the new government, alarmed Russian-speakers and helped fuel the separatist move in majority ethnic-Russian Crimea.

Describing "an understanding between the elites and regional government in the east and the central government", a political source in the Donbass said it included constitutional change to strengthen rights to use Russian as well as decentralisation.

"This will contribute to unity in the country," he said.

Volodymyr Kipen, a political analyst in Donetsk, said Moscow - despite its denials - could yet invade, or more likely promote unrest. But he also said the oligarchs, seeking stability for businesses built on the back of 1990s acquisitions of ex-Soviet state assets, were rallying behind Yanukovich's successors.

Noting the failure of pro-Kremlin activists to hold out after a takeover of the regional assembly building early this month that saw Russia's flag flown from the building for nearly a week, he concluded:

"The Crimean model has now failed in the Donbass."

Weekend rallies demanding union with Russia drew only a few thousand and passed off without incident, despite noisy chants of "Crimea-Donbass-Russia" during a standoff with riot police as people waved Russian flags below the Donetsk governor's office.

That protest failed to disrupt a visit by the German foreign minister, who met Ukraine's richest man Rinat Akhmetov and came away praising his pledges to prevent the country breaking up and to cooperate in liberal reforms of a corrupt, failing economy.

"We have heard here today the very pressing desire that the new Ukraine should be a united Ukraine and that there should be no breakup," Frank-Walter Steinmeier said after meeting Akhmetov and steel magnate Serhiy Taruta, Donetsk's new governor. He also met Prime Minister Arseny Yatseniuk and praised the "signal" he sent to easterners in a speech made, significantly, in Russian.


Taruta, critical of missteps in Kiev that played a part in the loss of Crimea, told Reuters he expected tough negotiations on sharing power but believed the government which appointed him was moving in the right direction. He felt his own efforts to ensure police were loyal and to stop Russian "provocateurs" coming across the border were curbing unrest.

Fear of hardline Ukrainian nationalists in the government is widespread among Russian-speakers in the east, who share the view dispensed by Kremlin-controlled media that there has been a "fascist coup" in the capital.

There is also deep anger in Donetsk region, home to 10 percent of Ukraine's 46 million people and producer of 20 percent of its industrial output, that 23 years of post-Soviet independence have left them poor and exploited by a rich elite many see as little more than a mafia.

Yet despite that profound discontent, only a minority seem actively to want to break with Ukraine and join Russia.

A month ago Steinmeier was in Kiev negotiating an end to bloodshed between Yanukovich's police and protesters.

His arrival in the fallen president's power base followed weeks of Western pressure for compromise to prevent Ukraine cracking open along an east-west faultline that could hand its main industries over to Russian President Vladimir Putin.

Ukraine plunged into crisis when Yanukovich spurned a free trade pact with the European Union in November, sparking protests on Kiev's Independence Square, known as the Maidan. He later took a financial aid package from Putin but, after the protests turned bloody a month ago, Yanukovich fled to Russia.

While threats of a trade war from Russia clearly played a role in Yanukovich's rejection of the EU pact, concern among eastern oligarchs at possible damage to their businesses from removing import duties was also cited by analysts as a factor.

Yatseniuk, in his broadcast last Tuesday, said he would avoid a free trade deal for now to protect eastern industry.

The premier, an ally of Yanukovich's long-time rival Yulia Tymoshenko who is widely disliked in the east, ran through a shopping list of policies designed to reassure Russian speakers, from ruling out NATO membership, to guaranteeing their language rights and pledging to disarm far-right and other militants.

One Western official described it as "everything we had been pleading for" to repair the rift in Ukraine and engage the east.


Perhaps most important for the eastern elite, however, was a promise of a constitution offering "decentralisation", rather than "federalism" - seen as a recipe for regions breaking away.

That was welcomed by Donetsk mayor Oleksander Lukianchenko when he addressed a regional congress of Yanukovich's Party of Regions on Friday. The party, previously a vehicle to assert presidential authority nationwide, was debating its role without its leader and shorn of its status as the "party of power".

Distancing the party from calls by some members for a local, Crimea-style referendum on federal autonomy or even secession, Lukianchenko said the party, which opposed federalism while in control in Kiev, supported Kiev's proposed "decentralisation".

He told Reuters the party wanted regions to have more power over budgets - they already raise substantial direct taxes - and also run services "like the police, courts and prosecutors".

Negotiations have yet to start in earnest on a constitution. Ukrainians will first vote for a president on May 25. But the idea of devolving control of the judiciary could be a key part of a post-revolutionary bargain between the rival factions.

Yanukovich saw Tymoshenko jailed for corruption after he beat her to the presidency. He is himself now a fugitive from justice, accused of the "mass murder" of Maidan protesters. The eastern oligarchs have reason to be anxious for their assets -and personal freedom - in a backlash against the old guard.

Maintaining the influence that civil rights activists say they already enjoy over the police and courts, could be a prize they are seeking in negotiations over decentralisation.

While some eastern businessmen are guarded in criticism of Russia - possibly out of concern for business ties there, or afraid tanks might roll into Donetsk - many have spoken out against Moscow. Ukrainian unity may be good for profits but also few would relish the curbs Putin imposes on Russian oligarchs.

Nonetheless, said analyst Kipen, some in the business elite seem willing to encourage the idea that eastern Ukraine could still be tempted to break way: "They want to play the separatism card as a bargaining chip with Kiev, for their own personal security and for their own interests."


Beyond the calculations of the oligarchs, who have managed to dominate Ukrainian electoral politics especially in the east, public opinion in Donetsk is sharply divided.

Many of those who took part in pro-Russia rallies cited Russia's stronger economy for wanting to follow Crimea.

"We want a referendum on joining Russia," said Anton Sedykh, 27, among a crowd of some 3,000 gathered under a statue of Lenin on Donetsk's Lenin Square, across the road from the gleaming glass office tower where Akhmetov met Steinmeier on Saturday.

The company where Sedykh makes windows had not paid him for two months, he said, and he envied higher wages in Russia. After 23 years of independence, he had no faith in Ukraine's economy. Nor was "decentralisation" an answer: "It's just playing for time," he said. "It's the oligarchs looking out for themselves."

Others at the rally cited cultural or family ties to Russia, nostalgia for Soviet certainties, an admiration for Putin's firm hand or a disdain for Ukrainian speakers in the west. There is also fear of EU free-market ideology and austerity. One poster showed German Chancellor Angela Merkel with a Hitler moustache.

For Denys, 35, a composer watching proceedings from across the square, the protesters were wrong to ignore Russia's flaws: "It's not about the economy," he said. "This is a fundamental question of freedom. Russia is a very authoritarian state."

His wife Svitlana, 29, said her criticism of Russia was not about ethnicity: "I have a Russian name. We speak Russian and Ukrainian," she said. "But I am a Ukrainian citizen."

Similar sentiments were voiced in dozens of conversations in the past week in Donetsk with people in colleges, shops, farms or the steelworks that sprawls into a city dotted by slag heaps and showpiece modern buildings. Factory workers clocking off were united in their fears of war with Russia and of damage to their export business - much of which goes into Russia.

"It might be better to be with Russia," said steelworker Ivan, 36. "We can't compete if they open trade with Europe."

But few people said their main priority was joining Russia.

Opinion poll evidence, from before the crisis came to a head a month ago, suggests core support in the area for Russian rule may be in single figures, although as many as a third of people were recorded as saying they might prefer living as Russians.


Alexander Bukalov of the Moscow-based human rights network Memorial said he saw little evidence in his work in Donetsk of Russian-speakers facing discrimination. He saw in the surge in protests since the fall of Yanukovich a "psychological outburst" among people still grappling with the collapse of communism, resentful of oligarchs and alarmed by Russian media reporting.

Reports of Moscow's troops massing unsettle people in the east. There is little sign Ukraine's army has moved in strength to the frontier.

While some in Donbass say they would be willing to emulate Crimean militias and help Russian troops take over the region, others say they would be ready to fight Moscow's forces.

Many analysts doubt a Russian move on the east though many believe Moscow has and will continue to promote militants there, looking for influence or a moment to step in. Signs the Donbass oligarchs are lining up alongside the leadership in Kiev, ensuring police rein in protests, may complicate that.

"We're past the worst," reckoned rights activist Bukalov, who thinks Russia has missed its moment. "They should have been quicker. They lost time and people have had time to think."

For Oleksy Garan, a political scientist in Kiev, however, Putin was unlikely to leave Ukraine alone, arguing that he did not want an example of a successful revolt on his doorstep:
"If the plan to split Ukraine doesn't work - and it seems it hasn't - they will try to complicate life for the central government and press for federalism," he said. "For them, it's important Ukraine does not make a successful transformation on their border. That's what they're afraid of."
Sean's Russia Blog
March 22, 2014
Ukraine: Two Heroes, Two Revolutions
By William Risch
William Risch is an Associate Professor of History of Georgia College and author of The Ukrainian West: Culture and the Fate of Empire in Soviet Lviv (Harvard University Press, 2011)

I have made three trips to Ukraine since protests began there in late November 2013.  On January 18, I found myself taking Ukraine's revolution into a new direction. In the city metro stations, I helped activists spread leaflets denouncing the dictatorship laws issued by the authoritarian regime of President Viktor Yanukovych. Our leaflets and placards called on people to attend a mass protest the next day. Some of the protest's attendants participated in the violence that night that ultimately led to the Yanukovych regime's collapse. However, there have been two revolutions going on. One has produced the specter of extremist right-wing nationalists seizing power from a democratically elected president, leading to justifications for Russia's invasion of Crimea and provoking pro-Russian revolts in eastern Ukrainian cities. The other revolution, the one that I participated in, faces the danger of being ignored.

You can sum up these two revolutions in portraits I saw next to one another this week on the Maidan, the center of Ukraine's protests: one of Viacheslav Chornovil, the other of Stepan Bandera.

Chornovil, a journalist who became a dissident in the late 1960s, came in second in Ukraine's first presidential elections in 1991. Leader of the People's Movement of Ukraine (Rukh), he died in 1999 in an auto accident that the authorities allegedly arranged. Bandera was one of the leaders of the Organization of Ukrainian Nationalists (OUN), accused of collaboration with Nazi Germany and murdering thousands of ethnic Poles during World War II.

Assassinated by a Soviet agent in West Germany in 1959, Bandera has become the ideological godfather of two right wing organizations prominent in Ukraine's new government, the Freedom (Svoboda) Party and the paramilitary group Right Sector. Chornovil's followers consist of a rump leftover of his former political party, which had already split on the eve of his death.

Yet Maidan activists have followed the practices of Chornovil, even if they know little of him. Chornovil had advocated Ukraine's peaceful separation from the Soviet Union, the defense of human rights, and the protection of Ukraine's ethnic minorities. His life began as a dissident when, as a journalist, he became outraged by secret trials that violated the Soviet constitution. A young dissenting journalist, Mustafa Nayyem, upset with his country's leadership, summoned Kyiv's first Euromaidan protest. Organizations like Civic Sector, the Student Coordinating Council, and all-Ukrainian forums of Euromaidan activists have embodied the spirit of peaceful protest, negotiations with people in power, and long-term changes to the state's institutions, laws, and practices.

Svoboda and Right Sector have also talked about fundamentally changing the state, but in practice, they have already been engaged in worrisome behavior. This week I saw Right Sector activists occupying buildings on Kyiv's main boulevard, including a hotel, a sporting goods store, and a cell phone outlet. Men in paramilitary gear, and sometimes even 14-16 year-old children, have been guarding the premises outside. On March 18, Svoboda's member of the Supreme Rada's committee on freedom of speech bullied the head of Ukraine's state-run TV agency, Aleksandr Panteleymonov, into resigning, threatening to beat him up if he refused. A Youtube video shows this man questioning the ethnic origins of entertainers connected with the agency before he barged into Panteleymonov's office.

This is not the revolution that we activists spreading leaflets in the Kyiv metro wanted. It would not have been the revolution Chornovil would have wanted. Because of Ukraine's extremely weak opposition parties, and because Svoboda and Right Sector advocated violent resistance after the regime harassed, assaulted, kidnapped, tortured, and killed protestors, Svoboda and Right Sector have become prominent forces in the new government.

Fortunately, the revolution embodied by Chornovil lives on. Ukrainian media widely condemned the attack on Panteleymonov. Singer Sviatoslav Vakarchuk from the rock group Okean El'zy, whose music has become part of the Maidan's soundtrack, called on Ukraine's new leaders to choose officials on professional merit and not party affiliation, engage in a dialogue with all of Ukraine's regions and social classes, and uphold the rule of law. The international community needs to support the revolution of Chornovil while scrutinizing the revolution of Bandera.

Washington Post
March 22, 2014
Why Ukraine's Euromaidan is not spreading to other post-Soviet states
By Farid Guliyev and Nozima Akhrarkhodjaeva
Farid Guliyev is a doctoral candidate in political science at Jacobs University Bremen, Germany. Nozima Akhrarkhodjaeva is a doctoral candidate in political science at the Research Centre for East European Studies at the University of Bremen.

Large-scale protests, like Euromaidan or the Arab Spring, tend to occur in waves clustered in time and space through the processes of cross-country political contention or diffusion, defined by Della Porta and Tarrow as "the spread of movement ideas, practices, and frames from one country to another". The Euromaidan protest was a sustained demonstration against what was perceived as highly corrupt and personalistic rule of Yanukovych, who was impeached by parliamentary majority after fleeing the capital Feb. 22. The events in Kiev drew attention of opposition activists in Azerbaijan, Russia and Belarus. Several weeks after Yanukovych's ouster, Mustafa Nayem, one of the protest organizers tweeted: "The biggest danger for Vladimir V. Putin is that Ukraine's revolution will eventually spread toward Russia."

Yet, the Euromaidan protests did not spark similar political activism in other post-Soviet semi-autocratic regimes. Why not? After all, only nine years ago, Ukraine's Orange Revolution was activated by a regional, if not global, tide of electoral revolutions.

There are two key insights from social movement literature that may explain why Euromaidan is not (likely to be) spreading.

1. An unappealing model and violence

To start with, Euromaidan does not offer an innovative and appealing template for regime opponents elsewhere. The previous Orange Revolution followed the electoral revolution model in which the stolen elections served as the focal point for anti-regime actors. Due to these easy-to-replicate, modular features, the electoral revolution model was a ready toolbox of successful protest frames and repertoire of contention that could be easily adopted and adapted by oppositionists in other settings.

On closer inspection, the Euromaidan movement deviates from the generic electoral revolution model in three important ways. First, integrity of elections was not an issue at stake this time. The demands raised by Euromaidan protesters changed over time shifting in emphasis from the outrage over Yanukovych's refusal to sign a European Union association agreement and his acceptance of loans and energy subsidies from Russia to demands to respect dignity and end corruption of senior officials, the president and his "Family". Since participants came from different walks of life, the protest movement was formed from heterogeneous and broad-based groups including ultra-nationalists from the Svoboda party and Pravy Sektor.

Second, in contrast to the 2004 revolution, political opposition parties joined the Euromaidan rallies at a later stage, were more fractured and lacked a unified leadership.

Third, Euromaidan was characterized by the extreme level violence which scared off potential foreign followers. As Sidney Tarrow noted: "Although violence impresses people, it has a severe limitation in the formation of movements, for it restraints and frightens off sympathizers." Unlike the bloodless protests in 2004, Euromaidan invokes in people's psyche images of burning cars, bonfires, thick smoke, Molotov cocktails and violent clashes leaving a hundred people dead and about a thousand injured.

Euromaidan is not the first major protest to deviate from the electoral revolution model. The violent anti-government demonstrations in Kyrgyzstan in 2010 forcing president Kurmanbek Bakiev out were not directly related to the electoral cycle either, the fact that led Joshua Tucker to aptly call the Kyrgyz protests the first "post-colored revolution" in the post-Soviet space. Ukraine's Euromaidan and Kyrgyzstan 2010 indicate the emergence of an alternative, non-electoral, form of collective action in post-Soviet Eurasia.

2. Authoritarian learning and negative framing

Not only was the Euromaidan violent and unappealing, the conditions on the ground had changed drastically as well. Over the years, the ruling regimes in Azerbaijan, Belarus and Russia adjusted their repression strategies and adopted new ones to squash any signs of a color revolution. All three regimes were "late risers" during the color revolution wave. As Mark Beissinger shows, state elites in "later risers" have an advantage over those in "earlier risers" in that they know about actions and strategies used by protesters in the initial wave and therefore can adapt.

Institutional screws were tightened as post-Soviet autocrats took preemptive measures. Russia played a leading role in spreading various diffusion-proofing strategies. Examples include Russia's restrictive legislation on non-governmental organizations in 2006 and the 2012 law requiring foreign-funded NGOs to register as "foreign agents". Such measures foreclosed the success of anti-Kremlin mass rallies on the Bolotnaya Square in Moscow. And as Julia Ioffe rightly noted, "much of the stringency and verticality of the Russian political system is a direct result of [reaction to] Ukraine's Orange Revolution."

Acting as a "black knight" and using a mix of carrots and sticks, Moscow provided a model for other authoritarian rulers to emulate. Putin's administration was the leading force in the movement to promote legislation against Western democracy assistance programs worldwide. The Kremlin's NGO laws were later copied by other post-Soviet autocrats. For example, in the aftermath of protests in early 2013, the Azerbaijani authorities started a campaign to crackdown on foreign NGOs. By the end of the year, new amendments to the law on NGOs introduced the requirement to appoint Azerbaijani nationals as deputy-chiefs in locally operating foreign NGOs that looked like a copycat of Russia's law on foreign agents.

Moreover, protest participation was also discouraged by a more subtler, cognitive mechanism. Putin's administration employed media frames to influence public opinion. Framing refers to the process of selecting some aspects of a perceived reality to make them more salient to communicate and advance a particular interpretation or moral evaluation of a problem. Framing becomes negative when used to portray an issue or an event in an unfavorable light with the aim to discourage popular support and/or provoke emotional disapproval.

Before the elections of 2007-2008, the Kremlin "produced a torrent of xenophobic, conspiratorial propaganda which attributed the upheavals on Russia's borders to Western incitement and vilified the Russian opposition as marionettes." Amidst the flaring of Euromaidan protests, Russia employed a full range of tools to frame the Euromaidan events as an illegitimate action led by extremist foreign-trained forces and fomented by the shadowy western powers.

A week after the start of the Euromaidan demonstrations, on Dec. 2, 2013, Putin's initial reaction was that the rallies in Kiev had nothing to do with Ukraine's EU integration aspirations but were "an attempt to shake the current ... legitimate authorities" by "very well prepared and trained militant groups". He said the events  "don't look like a revolution, but rather like 'pogrom'". On Dec. 14, Russian Foreign Minister Sergei Lavrov said: "There's no doubt that provocateurs are behind this. The fact that our Western partners have apparently lost touch with reality is a great sadness to me."

After the impeachment of Yanukovych on Feb. 22, which pro-Russian media portrayed as a "fascist coup," the rhetoric began to question the legitimacy of the interim authorities by calling them "radical nationalists" supported by western governments. Russia's ambassador to the United Nations, Vitaly Churkin, accused Western powers of backing what he called "fascist thugs" in Ukraine.

Russian citizens' views depend to a large extent on what they see on TV screen. All TV channels were involved in negative framing of the Euromaidan events. Polls conducted by Levada Center between March 7-10 indicate that 37 percent of Russian respondents believe that Ukraine has been taken over by radical nationalists, whereas 62 percent said there is currently anarchy and no legitimate authority in Ukraine.

Because Russia reaches out to a significant segment of Belarus' media landscape through ownership of two of the three most viewed TV channels, Belarusians are exposed to the same media frames as their counterparts in Russia. Belarusian TV channels portrayed the Kiev protests as being instigated and financially supported by the external forces, including the E.U. and the United States, while protesters were referred to as "radicals and extremists". Lukashenko himself referred to the events in Ukraine as "terrifying and catastrophic" and ruled out the possibility of a Maidan-type of revolution in Belarus.

In Azerbaijan, a major opposition party leader said, "Maidan can find a fertile soil in Azerbaijan". However, the Azerbaijani government did not seem to be alarmed. Perhaps not coincidentally, in mid-February, a pro-government deputy alleged that foreign embassies were preparing a revolution in Azerbaijan, while a senior official from the presidential administration tweeted asking who could have come up with "this strategy" toward Ukraine clearly alluding to the meddling of foreign powers. Predictably, a ruling party MP said that Yanukovych's downfall was unconstitutional.


Although demands raised by protesters in Kiev resonated well with grievances held by people across post-Soviet states, Euromaidan did not spill over the borders. It lacked an appeal of an easily transferable peaceful model. Moreover, opposition activists' room for action was severely circumscribed by the institutional constraints and unfriendly discursive environments in which they have to operate.

Considering this, faced with the agility of autocrats to learn and adapt, pro-democratic forces across the post-Soviet states should reconsider their protest strategies and try to develop less violent and more creative ways to frame and organize collective action.

Business New Europe
March 24, 2014
Russia-Ukraine: Return of the Prometheans
Chris Weafer, Macro Advisors

"Taking a new step, uttering a new word, is what people fear the most"
Fyodor Dostoyevsky, Crime and Punishment

The threat is more important than existing sanctions. The sanctions announced so far do not directly cause any material disruption to the economy. But the actions taken by the US/EU bring Russia to the outer limit of the "inconvenient" sanctions. Any additional sanctions are likely to cross into the trade and economy disruption category. It is that threat which is now of greatest concern to investors/business community.

Political rhetoric will get worse this week. The assumption is that moving to more serious sanctions is now linked to Russian actions elsewhere in Ukraine. Moscow continues to play down that risk but the political rhetoric from the US/EU is expected to ratchet up much further this week as the G7 leaders hold a series of meetings in Europe and, most importantly, in Kiev.

The risk premium is staying high. Politics and the threat of next stage sanctions will keep markets nervous again this week. The dollar based Russian indices are already in a bear market in 2014. Sentiment is super sensitive to any comments or actions from either side. That backdrop of political nervousness may not change until the election processes are completed in Ukraine later this summer. But, any sign of political cooperation will cut the risk premium and send indices up at least 10% in a knee-jerk move.

Talks about a Ukraine bailout have to start soon. Assuming the political risk calms this week the focus will soon have to revert to the bailout. Every week that passes increases the size of the cheque required and the difficulty in reviving the economy.

Russian market is important. Moscow has said that it will revert to the old gas tariff from April 1st which, without the naval base discount, means that Ukraine would pay close to $500 p/'000 cm, i.e. the highest in Europe. Russia's share of Ukraine exports is 25% and despite the new trade deal with the EU, it will not be able to replace that market for years. Bailout talks will have to include a Russia input.

Insiders have started to buy equities. One theme which is starting to emerge in Russian equities is share buybacks by companies and share buying by existing core shareholders. We review a list of shares (below), many of which are well supported with a high dividend yield, which may see share buybacks or core shareholder support.

Revised top DR picks. The list of our Top Russian stocks is revised later in this note to reflect long term investment opportunities opened up by the stock indices collapse. (tables below). In particular we highlight Novatek, Megafon and CTC Media which have been hard hit because of ownership risk. We rate all three as buys for investors who can suffer short-term volatility.

Situation update

Sanctions have targeted individuals and two banks. Both the US and the EU expanded their sanctions lists last week but have refrained from imposing any sanctions which directly impact the Russian economy or external trade. The sanctions announced so far only impose travel bans and asset freezes on named individuals and two banks with no meaningful role in external trade. The big threat, however, is that we are now close to the boundary between these "inconvenient" sanctions and the more serious "economy disrupting" sanctions. Hence the concern is not what was signed last week but what may be signed this week.

President Obama starts a weeklong trip to Europe this week and included is a meeting of the G7 in Kiev. This is, therefore, a much more dangerous week for Russia as the threat of additional and damaging sanctions will be on the agenda every day and will likely feature prominently in the media headlines. Investment sentiment is already very sensitive to news headline and will certainly continue to be this week.

Companies are nervous. Foreign companies are equally nervous that the sanctions list may be expanded to affect their activities or even their presence in Russia although, thus far, that remains only a threat rather than current. Our view is, as it has always been, that a move up to the more dangerous sanctions is still unlikely unless Russian forces actually move into another part of Ukraine. Several EU leaders made that clear over this weekend and that message is expected to be front and center this week. The caveat of course is that situation like this are very unpredictable and so many vested interests, on all sides, are involved. So a very cautious position is clearly prudent until the actual threat level becomes clearer.

The backdrop will remain nervous for months. In reality the threat of more serious sanctions will remain in place until some form of political dialogue is restored between Moscow and Kiev or between Moscow and the EU concerning Ukraine. That may not happen until after the May 25th presidential election and maybe not until the RADA elections are held. So far no specific date has been set for that latter election other than a vague "mid-summer". The specific threat is of violence in east Ukraine during both elections if people, who previously mostly supported Yanukovich and the Party of the Regions, are disenfranchised. Reports of instability during these election periods, i.e. assuming nothing escalates before then, will keep market sentiment firmly in the nervous category for months to come.

Both hope and threats are rising. The recent statements from Moscow plus the linking of trade/financial sanctions to any further incursion into Ukraine by Russian forces by several EU leaders over the weekend, offers the hope that a political escalation can be avoided, albeit a greater intensity to the statements from western leaders in absolutely inevitable. That would then mean that, by the end of this week, the focus should start to re-fix on the trend in the economies of both Ukraine and Russia. We will not get a proper view of the trend in either the Ukraine or Russian economies until mid-April or mid-May when the data covering the March escalation is known and the impact on ongoing activity better assessed. Meantime we are sticking with a current year GDP growth forecast of +1.0% for the Russian economy and a contraction of 2.0% for Ukraine until a proper review can be completed. Both numbers will almost certainly change by mid-year.

The impact on the economy is yet to be calculated. For Russia the big issue is the impact on domestic consumer and business confidence and what that is doing to activity. The concern is also about the damage to inward investment flows and rising capital outflows. For Ukraine the problem is much more basic; the country needs a huge bailout and quickly. So far all that has been signed is a political cooperation agreement between Ukraine and the EU and a $1 bln loan guarantee from the US. The government actually needs hard cash. The talks may switch to the bailout this week when the G7 meets in Kiev. Investors are certainly expecting that as the longer the issue is avoid the larger will be the cheque required and the longer it will take to revive the economy.

Note: We will review the current macro indicators for the Russian economy in the next issue of Macro Monthly, due early next week.

Russia is still important for Ukraine's economy. The Ukraine economy is the one factor which might encourage an earlier dialogue between Ukraine, EU and Russia. An update on the issues concerning both is later in this note. But two factors are worth pointing out;

1. Russia has said that it will revert back to the higher gas tariff from April 1st. This will push the price charged to Ukraine from the 1st Qtr price of $286 per 1,000 cubic meters (cm) to almost $500 p/'000 cm. That is $100 p/'000 cm higher than Ukraine paid previously because Russia no longer has to offer the Navy base discount. The revised price is the highest in Europe and Ukraine cannot afford it. Negotiating either a new contract or offering a new compensating discount is one of the two aces Moscow holds.

It is assumed that the Prime Minister's comment about possibly looking for a back tariff of $11 bln is not a realistic proposition but has been mentioned to emphasise that Moscow does still have an important role in its neighbors economy. Neither the IMF nor the EU will be keen to pick up the tab for such a high gas tariff nor to have to pay off the $2 bln that Ukraine owes under existing contract terms. This should at least open the way to bring Moscow to somebody's table to discuss the issue.

If Ukraine repudiates the gas contract terms and there are no talks to resolve the issue, Gazprom may well turn off the as flow to Ukraine again. The last time, 2009, this happened Ukraine simply tapped into gas intended for Gazprom's EU customers and that led to the pipeline being fully closed. It could happen like that again but is unlikely. Ukraine has now moved close to the EU and would not want its first action being to siphon off gas. In any event, Ukraine has said it has a reserve supply for many months.

2. Even though Ukraine and the EU have now signed a cooperation agreement which will make it a lot easier for trade to flow west. But that is a long term proposition and meantime almost 25% of Ukraine exports have been flowing to Russia and a larger percentage through Russia. If the border were to be closed to Ukraine trade this would make the cost of the IMF/EU bailout larger and reviving the economy would take many years longer.

So called "Odious debt repudiation is not realistic. There has been some discussion by academics last week that Ukraine has a case to make that the $3 bln loan advanced by Russia to the previous government in December plus the gas debt may be repudiated under the precedent of "Odious Debt", i.e. debt acquired to fund or prop a previous regime rather than for genuine economic purposes. That course is most unlikely to be adopted by the Kiev government for the two key reasons cited above.