#1
The National Interest
May 22, 2015
Avoiding a New 'Cuban Missile Crisis' in Ukraine
Unlike in 1962, Russia has geography and national will on its side in Ukraine.
By Rajan Menon
Rajan Menon is Anne and Bernard Spitzer Professor of Political Science at the Colin Powell School of the City College of New York/City University of New York and a Senior Research Scholar at the Saltzman Institute of War and Peace at Columbia University. His most recent book (coauthored with Eugene B. Rumer) is Conflict in Ukraine: The Unwinding of the Post-Cold War Order (MIT Press, 2015); his next book, The Conceit of Humanitarian Intervention, will be published by Oxford University Press in 2016.
Fourteen months ago, Ukrainian president Viktor Yanukovych was run out of office by demonstrations sparked by his shelving of the "Association Agreement" with the EU. The accord had substantial support in western and central Ukraine, in particular, and Yanukovych's decision to opt, instead, for a $13 billion loan from Moscow in exchange for joining the Russian-led Customs Union sealed his already-precarious fate. What the Maidan protestors and Western leaders praised as a people's revolution, the Kremlin condemned as an "extra constitutional coup." After Yanukovych's fall came the (unconstitutional) March 16 Crimea referendum in which over 90 percent of the voters chose union with Russia. (Though the results were widely dismissed, over 80 percent of the respondents in a June Gallup poll opined that the outcome reflected popular sentiment in Crimea.) The Russian parliament then ratified a "Treaty on Accession," the formalization of Russia's annexation of the peninsula. That deepened the crisis: determined to emulate Crimea's example, separatists soon took up arms in parts of Ukraine's Donbass. Moscow proclaimed itself their patron.
The Donetsk People's Republic and the Luhansk People's Republic were soon under threat from the advancing Ukrainian army and a gaggle of private militias. They may well have been overrun had Russian troops not opened a new front in Novoazovsk, on the Black Sea coast, in August, drawing Ukrainian forces southward and pummeling them. Simultaneously, Moscow increased arms shipments to its clients, and regular Russian units bearing heavy weapons started playing a far more prominent part in the war. The Kremlin's denials of direct involvement were comical, but its added military muscle proved transformative.
The Minsk II ceasefire was signed on March 12 of this year, but six days later Ukrainian troops, who had been surrounded on three sides, were forced from Debaltseve. Those two events created the current line of control in eastern Ukraine. The March accord hasn't ended the fighting and the dying, and it main provisions haven't been fully implemented. Still, unlike its predecessor, Minsk I, which became a dead letter within days of being signed on September 5, it has survived.
Minsk II hangs by a thread, though, and the risk of renewed war remains real: it doesn't take more than a few ugly incidents to shred fragile ceasefires. One place where the shredding could start is Shyrokyne, a small settlement (its population is less than 1,500) in Novoazovsk district, off the E-58 highway and 12 miles east of the Black Sea port city of Mariupol. Shyrokyne has been shelled repeatedly by Russian and separatist forces, and its fall would imperil Mariupol. Were Putin to then throw caution to the wind and order his army to push west with the aim of creating a land connection to Crimea, today's crisis will seem minor by comparison.
While none of this is foreordained, Minsk II's death would take all the parties involved in this fracas-Ukraine, Russia, and NATO-to a very dangerous place. The United States is already training Ukraine's army and has allocated $195 million for non-lethal equipment, and President Obama will face intense pressure to send lethal arms to beef up the Ukrainian army. There should be no illusions about the consequences: Vladimir Putin will pour in more weapons and troops. And NATO's already-anxious eastern members, Poland and the Baltic trio, will demand that it allies dispatch reinforcements. Moscow will push back if that happens. In short, a classic conflict spiral will commence.
The war in Ukraine has already created the most dangerous confrontation between Washington and Moscow since the Cuban Missile Crisis. If Obama scales up arms supplies to Ukraine in response to Minsk II's collapse, the United States and Russia will be engaged in a military test of wills-on the latter's doorstep. In 1962, geography favored Washington; Moscow had to withdraw. In 2015, proximity will permit Russia to bring additional men and materiel to the battlefield far faster than the United States can bolster Ukrainians units, let alone create an effective Ukrainian army.
Besides, Russia simply has far more at stake in Ukraine than the United States and its NATO allies do, and that means that Putin will take risks that the West simply won't. It would be morally reprehensible and strategically obtuse, therefore, to encourage Ukrainians to conclude that the West will match Russia move for move. Ukrainians can be forgiven for getting precisely that impression from Assistant Secretary of State Victoria Nuland's May 18 press conference in Kyiv.
While the "arm Ukraine" chorus persists, it hasn't yet explained what the United States should do if Putin escalates rather than desists. If he ups the ante, Washington will face two choices, neither of them good: backing off or doubling down. Taking a momentous step based on hope, and without an effective and feasible countermove at hand in case the opponent fails to do what you expect, amounts to reckless folly-the more so since, during this crisis, Putin hasn't done what the West has assumed he would.
The bite of economic sanctions was supposed to bring him around. But a year has passed since the penalties were imposed and, rather than extending an olive branch, he has boosted Russia's military role in Ukraine's east and stepped up air and submarine patrols, not a few of them risky, in NATO's domains. There isn't a scintilla of evidence that he plans to ditch the Donbas republics, let alone seek a compromise on Crimea, to ease the economic pressure on Russia. Predictions that his political system verges on collapse amount to the wish fathering the thought.
Yes, the West has isolated Russia by, for example, shutting it out of the G-8 and boycotting the May celebration of the Soviet victory over Nazi Germany, and Putin probably misses being part of the big-power club's (largely useless) conclaves. And yes, he was miffed by the May boycott. But Washington's mantra that Russia stands isolated internationally amounts to wishful thinking. India and China have refused to follow the West's lead on Russia, and so have a host of other Asian, African, and Latin American countries.
Putin certainly faces serious problems. The Russian economy contracted by 1.9 percent in the first quarter of 2015. The ruble's descent-it nosedived at the end of last year-contributed to an inflation rate that reached 16. 9 percent in March. The Russian central bank spent billions of dollars shoring up the currency, but it could be called upon to spend even more. Russia's mega companies had gone on a borrowing binge when oil prices were sky-high and Russia's economy was growing at a fast clip, but the sanctions cut them off from Western capitals markets, and with bills coming due, they turned to the state. Rescuing them reduced the central bank's reserves further-from about $500 billion at the beginning of 2014 to $356 billion last month. Moscow could have managed this economic pain more easily had the sanctions not coincided with a collapse in oil prices, which went from $105 a barrel in early 2014 to $48 at the beginning of this year. This was a big blow because together oil and gas provide two-thirds of Russia's exports earnings and half of its budget revenues.
Despite these difficulties, Western economic pressure hasn't pushed Putin to yield an inch. Indeed, the assumption that he would was flawed from the get-go, based as it was on the notion that in international politics (or interpersonal relations for that matter) money trumps motives born of fear, anger, status anxiety, pride-that leaders are like green-eyeshades accountants and make high-stakes national security choices based chiefly by crunching numbers. History tells us otherwise.
Moreover, whether it's Russia's stock market, its agricultural and manufacturing output, the ruble's value, or oil prices, the trend lines now appear to favor Russia, even though plenty of problems lie ahead and the picture won't change as long as the Kremlin presides over a corruption-riddled petro state.
Russia's economic woes, while scarcely trivial, pale in comparison to Ukraine's. Simply put, the Ukrainian economy risks collapse. GDP contracted by 15 percent in 2014 and 17.6 percent just in the first quarter of 2015. Ukraine's central bank reports that total external debt has declined by $10 billion since last spring, but it still totals $128 billion (and includes a $3 billion bond held by Russia). When the crisis commenced last March, Ukraine's total debt was 40 percent of GDP; it's now over 100 percent. Kyiv owes foreign creditors $10 billion in interest payments alone this year, and none of them agreed to a write-down. Meanwhile, the Ukrainian treasury held a mere $7.5 billion at the start of this year when including Special Drawing Rights and gold stocks: enough to cover a few months of imports.
To help out, the United States has provided $1 billion in loan guarantees (and may offer an additional $2 billion), and the EU has promised €11 billion over five years. The IMF has offered much more: $17 billion, to be paid in installments through 2018. But the budget trimming it has demanded as a precondition for the quarterly disbursements will hurt Ukrainian citizens, especially the poor and the aged, because Kyiv must slash subsidies and fix the broken pension system (which means cutting benefits or extending the retirement age, perhaps both).
While economists insist that tough reforms like these are essential, the nascent Kiev government, which is already beginning to lose the public's confidence, lacks the strength and unity required to administer the bitter medicine. The IMF also insists that Ukraine's leaders must find $15 billion in debt relief, and $5 billion of it this year, before they receive the next tranche of that $17 billion. But no one is rushing to Ukraine's aid. Not surprisingly, Ukraine's parliament authorized the government to withhold payments to "unscrupulous" parties. Contrary to immediate reporting, the move falls short of a moratorium; but it does inch toward one, thus heightening fears of a default and sending the wrong message to would be lenders.
As for Ukraine's much-discussed corruption, it enriches groups that are well connected to the state or part of it, and they won't relinquish their power and wealth without a fight. Moreover, corruption in Ukraine has deep economic and political roots and did not start with Yanukovych, though he certainly raised it to new heights; it was baked into the system of political economy created during Leonid Kuchma's presidency in the 1990s. (President Poroshenko, one of Ukraine's oligarchs, was among those who thrived under this arrangement.) Creditors now demand that Kiev demonstrate tangible progress against corruption, but no country has extirpated this scourge quickly; and Ukraine will not be able to, not least because of a legal system even well-wishers involved in reforming it describe as dysfunctional and itself corrupt.
Putin well understands the magnitude of Ukraine's economic problems, and his real aim may not be to grab more of its land but rather to wreck it economy and bring down its government by keeping the war, which according to Poroshenko costs as much as $8 million a day, simmering. If this in fact Putin's strategy, he hasn't done too badly, particularly because a main consequence of the war has been Kiev's loss of a chunk of the Donbas, an industrial, energy, and mining center.
Given that sanctions have not worked and that renewed full-scale war is both probable and dangerous, the only sensible approach is shoring up Minsk II and working with Russia-and of course Kiev-on a formula that keeps Ukraine whole and addresses principal Russia's security concerns. The terms that Ukraine and Russia are prepared to accept won't be clear until the hard bargaining begins. At minimum, though, Ukraine will insist on regaining control of its breakaway eastern regions and guarantees of substantial Western economic aid. (It's expensive, this democracy building.) Russia will push for a phased lifting of sanctions and some sort of neutrality pledge from Kiev.
But even more will be needed to create a durable peace. Heavy weapons and soldiers (regular and irregular) must be fully withdrawn from the war zones, with compliance monitored by third-party observers. A no-weapons-zone must be created on both sides of the Russia-Ukraine border and verification processes put in place. Without these additions steps, talk of elections in the Donbas, regional autonomy (or some other form of decentralization), and political reconciliation based on a new national compact will amount to verbiage.
Beltway orthodoxy avers that Washington must not appease Putin by negotiating with him and that he will cave if the economic screws are tightened, never mind that Putin remains unyielding and that the consensus among the 28 members of the EU on sanctions, already showing signs of strain, will not last indefinitely. Victoria Nuland and Secretary of State Kerry's trips to Russia suggest that stubborn facts may have finally induced the White House to try a different tack.
A meaningful deal on Ukraine will prove a longshot at best. But staying the current course will prove ruinous (economically and strategically) for Ukraine, and could push Russia and the United States from crisis to collision.
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#2 http://newcoldwar.org New video showing Euromaidan snipers firing on police and protesters on Feb 20, 2014 [Video here http://newcoldwar.org/new-video-showing-euromaidan-snipers-firing-on-police-and-protesters-on-feb-20-2014/] From the Facebook page of Ottawa researcher Ivan Katchanovski, May 8, 2015 New video posted on YouTube provides direct evidence of shooters killing an entire group of Maidan protesters from the Hotel Ukraina on February 20, 2014. The video corroborates other evidence mentioned in my study [Feb 20, 2015], such as eyewitness reports, directions of entry wounds, and bullet trajectories. The video shows that its maker and some other protesters noticed the shots from the hotel at the direction of the protesters. He zoomed to specific open windows on the 12th and 9th floor of the hotel, but then had to flee to the cover of trees after a bullet hit a metal pole near him. The video was uploaded to YouTube more than one year after the massacre. But this crucial new evidence is deliberately ignored by the Ukrainian media and official investigation, even though they are aware of the video because it was recently posted on Nebesna sotnia, Maidan samooborona (Maidan Self-Defence) and Pravyi sektor (Right Sector) Facebook groups. It is noteworthy that the crucial video was also ignored by Maidan Self-Defence and the Right Sector, whose leadership and covert armed groups of "snipers" were linked to this massacre of both police and the protesters. During the first minute and a half of this video, which was filmed from 9:28am till 9:32am on February 20, at least six protesters were killed and many others wounded in the same area near Zhovtnevyi Palace. Three other protesters were killed there within three minutes prior, and another protester within a minute after the end of the video. The video shows that Ihor Kostenko was killed in the rear of the advancing protesters at 9:28am, and it zooms on large caliber pellets near the place of his killing a minute afterwards. He reportedly had more than one entry wound, specifically to his head and to the legs. This is consistent with use of hunting shotguns with large caliber pellets by the Maidan shooters, specifically at the Hotel Ukraina. In spite of its importance, the mainstream media in the West would likely not report this crucial new piece of evidence pointing to actual Maidan "snipers" who massacred their fellow protesters as a part of the organized violent overthrow of the government. Ivan Katchanovski has published several studies of the sniper massacres of Feb. 20, 2014 in Kyiv and of the arson massacre in Odessa on May 2, 2014: The "Snipers' Massacre" on the Maidan in Ukraine (revised and updated version), by Ivan Katchanovski, Ph.D., published on academia.edu, Feb 20, 2015 http://newcoldwar.org/the-snipers-massacre-on-the-maidan-in-ukraine-revised-and-updated-version/A new analysis of the massacre events in Odessa, Ukraine on May 2, 2014, by Ivan Katchanovksi, May 2, 2015 http://newcoldwar.org/a-new-analysis-of-the-massacre-events-in-odessa-ukraine-of-may-2-2014/Katchanovksi will present his analysis of the Odessa massacre in a paper to be presented to the upcoming Canadian Association of Slavists conference in Ottawa [May 30-June1]. The seminar is scheduled for Saturday, May 30 at 10 am. The analysis uses various sources, such as a special parliamentary commission report, May 2 group reports, videos and recordings of live broadcasts and calls to firefighters, leaked medical examinations, media reports, and interviews by participants and eyewitnesses from both sides and by the police commanders. Also speaking at the seminar will be Halyna Mokrushyna, recently returned from a reporting trip to Donetsk. |
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#3
www.rt.com
May 21, 2015
'Humanitarian suicide': Kiev backtracks on human rights pledge in Eastern Ukraine
The Ukrainian parliament has approved a regulation removing the obligation to protect certain human rights in the eastern Donetsk and Lugansk regions.
An note accompanying the regulation states that the conduct of what Kiev calls"anti-terrorist operations" in the Donetsk and Lugansk regions is not in compliance with the country's obligations for the protection of human rights. The document, cited by Tass, also mentions an "objective necessity to take measures to repel armed aggression of the Russian Federation"prompting Ukraine"to implement a temporary derogation from its obligations to ensure certain human rights to the extent permitted by relevant international agreements."
Among the articles of the International Covenant on Civil and Political Rights and the European Convention on Human Rights the Ukrainian authorities can now refuse to fulfill in Eastern Ukraine are those stipulating the obligations to protect the security of citizens and their right to a fair trial, freedom of movement, choice of residence and guarantee the inviolability of people's homes.
Ukraine's Foreign Ministry has been instructed to notify the UN Secretary-General Ban Ki-moon and Secretary General of Council of Europe Thorbjorn Jagland of the new regulation.
Russian children's rights commissioner, Pavel Astakhov, said Kiev's regression on human rights violations was "humanitarian suicide."
"They have committed 'humanitarian suicide' by legally refusing to adhere to the Convention on Human Rights," Astakhov wrote on his Twitter feed on Thursday.
Kiev's decision to renege on its human rights obligations under the UN Convention comes at a time when, according to German Chancellor Angela Merkel, the Ukrainian crisis is supposed to make the EU's partnership with the bloc's eastern neighbors "more important than ever."
Merkel said peace in Europe had been affected by the conflict in eastern Ukraine, stating: "Not least under these circumstances, the eastern partnership is more important than ever." She spoke in the Bundestag before joining a summit in Latvia with six of the EU's ex-Soviet neighbors.
"We will further support our eastern neighbors on their path to a society based on democracy and the rule of law," Merkel added, Reuters reported.
Among the eastern partners that the German chancellor was referring to were Ukraine, Moldova and Georgia, all of whom have been looking to join the EU.
The Ukrainian conflict broke out in April 2014 after Kiev sent troops to the Donetsk and Lugansk regions after local residents refused to recognize the new coup-imposed authorities in Kiev. The highly-awaited Minsk accords, brokered by Russia, Germany and France in February of this year, brought several weeks of calm to the region, but ceasefire violations by both sides have been growing, hampering the peace process. According to OSCE observers, up to 80 percent of ceasefire violations have been perpetrated by the Ukrainian army and the so-called "volunteer battalions" who are fighting alongside the Ukrainian army.
According to the UN human rights office, at least 6,116 people have been killed and 15,474 have been wounded in Eastern Ukraine during a year of fighting. The real numbers could be much higher, however.
In an interview with RT, the human rights ombudsman for the Russian Foreign Ministry, Konstantin Dolgov, described the situation in Ukraine as far as human rights are concerned as "catastrophic."
"Ukraine is still a country which has quite a number of political prisoners and political inmates. And this is a big problem. They have not abolished their so-called 'lustration' law, which has been criticized by the Venice Commission of the Council of Europe. [Also we should] not forget about the lack of investigations into huge crimes in Odessa and Mariupol," Dolgov said in March.
Earlier this month, Moscow called on the international community to put pressure on Ukrainian authorities, which according to Russia's Foreign Ministry, are not making any "tangible steps" toward an independent and impartial investigation of last year's Odessa massacre.
On May 2, 2014, Ukrainian radicals set fire to the Trade Union House in Odessa, killing 48 and injuring over 200 anti-Kiev activists inside. "As a result of these barbaric acts of intimidation, several dozen people, whose only fault was that they openly expressed their civic stance against the anti-constitutional coup in February 2014 and outburst of radical ultranationalists, were killed," the Foreign Ministry's statement pointed out. The shocking incident received little coverage in the Western media.
Moscow urged the international community, including human rights NGOs, to "decisively and honestly" demand Kiev stage a fair investigation into the Odessa massacre and correct the "glaring flaws" in the Ukrainian judicial system.
The ministry stressed that the lack of attention given to the Odessa massacre in European and US news was "yet another manifestation of information warfare and manipulation of the media."
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#4
UNIAN (Kyiv)
www.unian.info
May 21, 2015
Ukrainian prisoners in Donbas made slaves in Chechnya, relatives say
From 400 to 700 Ukrainians captured in the Donbas conflict zone have been taken to Russia, and many sold into slavery in Chechnya, Ossetia and Adygea, according to an open letter of the relatives of prisoners to the Russian human rights defenders published on the Web site of Open Russia public organization on Wednesday, a Ukrainian news broadcaster has reported.
"We assume that they could be there, because the missing himself or unknown people called relatives from Russian numbers, from Chechnya or Adygea. Some of the relatives received calls from human rights activists from Russia with a message that they had found their relatives in a Russian jail. Some of them, as we know, were sent to Chechnya or Adygea," the letter says.
Not only the Ukrainian military but also civilians are among the missing, namely volunteers who provided humanitarian assistance to the needy, and those who visited their relatives who were called for service in the Ukrainian army during the mobilization.
Those who managed to escape from captivity told relatives of the missing people that since the summer the prisoners had been repeatedly transported to Russia's Rostov region or deeper into Russia to work. They were transported across the border through different checkpoints, in particular through the Izvaryne checkpoint.
"Please note that we are not talking about prisoners of "republics" and "Cossacks." These missing persons are not on the list of dead or among the prisoners to be exchanged in accordance with the Minsk agreements. At the moment, we've lost contact with them," the letter reads.
Some relatives of the missing persons were offered by unknown persons by telephone or via the volunteers to return a prisoner for a large ransom. Some callers talked with an Eastern accent.
"Sometimes it sounded like this: "Your relatives were sold into slavery, and you will never see them," the relatives of missing persons wrote.
"All those who were taken to the Caucasus - Chechnya, Ossetia and Adygea - are not likely to be held in a jail. From various sources we know that our relatives were taken and sold as a labor force. We cannot say with certainty that this is true, but such cases have been revealed by the various human rights activists and journalists," the letter says.
At the request of relatives, the journalist Anna Nemtsova tried to trace such a trail in Chechnya. Her sources have confirmed that these events are taking place, but it is necessary to look for these "sold" people - and it's not easy.
Relatives of prisoners have compiled a list of missing persons whose relatives or friends received calls from phones on roaming in Russia, particularly in Chechnya, Ossetia and Adygea. The list consists of 120 people, but apart from them, from 400 to 700 citizens of Ukraine may be in Russia, according to various estimates.
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#5
Kyiv Post
May 21, 2015
Ready To Fight: Right Sector sets up camp in Dnipropetrovsk Oblast
By Oleg Sukhov
POKROVSKE, Ukraine - Located on land once controlled by the Zaporizhian Sich, a Cossack republic from the 16th to 18th centuries, the rear base of the pro-Ukrainian Right Sectorr's military unit in Dnipropetrovsk Oblast fits the place quite well.
Just like the Zaporizhian Cossacks, fighters of the Right Sector's Ukrainian Volunteer Corps have problems with legal recognition. While the Cossacks were split into independent ones and those "registered" under the aegis of Polish kings, Right Sector volunteers have no legal status.
Its volunteer corps has been involved in a long-running dispute with authorities over the issue. Recently, relations between the unit and the army's top brass have improved but disagreements remain.
The base, located in a forest near the village of Pokrovske, is not far from Hulyaipole, the capital of anarchist Nestor Makhno's Free Territory in 1918-1921 - another historical association that Right Sector fighters cherish.
The volunteer unit's 5th battalion is based in a former Soviet children's summer camp. The Right Sector's fearsome reputation is offset by posters left from the camp and children's pictures with good luck wishes sent to fighters and posted on the walls of the base's cafeteria.
The Right Sector has proposed joining the military as an autonomous unit with its own commanders. But the government has insisted that they be integrated into existing units.
The disagreements reached a fever pitch in late April, when regular army units surrounded the Right Sector base, and its spokesman Artem Skoropadsky said at a rally in Kyiv that the Presidential Administration would be "burned to the ground" if the authorities continued their pressure. Another dangerous moment was when a soldier at a checkpoint in Dnipropetrovsk Oblast shot his rifle in the air when Alla Megel, head of the corps' information department, passed through it.
The General Staff attributed the encirclement of the base to military exercises but the Right Sector said the aim was to scare the unit.
The tense standoff cooled by early May, when army checkpoints around the Right Sector base were removed, and the authorities agreed that the Ukrainian Volunteer Corps would join the army as a separate unit. On May 14, Right Sector leader and lawmaker Dmytro Yarosh submitted to parliament a bill to legalize the corps.
Megel and the commander of the corps' fifth battalion, who goes by the nom-de-guerre Chorny, downplay the conflict. "How can we settle a conflict that did not exist?" Megel told the Kyiv Post.
However, fortifications built by the men to ward off a potential attack by the regular army indicate that the conflict was a serious one.
Right Sector members emphasize that they have no disagreements with rank-and-file soldiers and officers of the regular army. "Right Sector fighters were in the same trenches with them," Megel said.
It is the generals and the authorities that they disagree with. Fighters of the Ukrainian Volunteer Corps distrust President Petro Poroshenko's administration and the General Staff and accuse them of mismanaging the country and failing to defend it from combined Russian-separatist forces.
Right Sector soldiers argue that they derive their mandate directly from the Constitution and the right to protect their homeland from foreign aggression.
"The Ukrainian Volunteer Corps doesn't need to be legalized," Megel said. "It's tangible, and it exists. In society, it has already been legalized."
She believes the government's description of the conflict as an anti-terrorist operation is illegal because it has surpassed its legal definition in time and scale, and de facto it is a war.
"If there is a war, we are legal. We are partisans," she said. "Either the Ukrainian Volunteer Corps is illegal, or the anti-terrorist operation is."
The authorities have insisted that all units without a legal status be removed from the frontline. In April the Ukrainian Volunteer Corps withdrew from Pisky, a key village strategically located next to Donetsk Airport.
However, Right Sector fighters are attached to regular army units and the Aidar, Dnipro and Azov volunteer battalions, Megel said.
"Withdrawing all of them would be like taking all nails out of a structure," she said. "It's impossible to withdraw them."
Right Sector fighters with the noms-de-guerre of Engineer and Odin believe the situation in Pisky has significantly deteriorated after the Right Sector withdrew, and now it's much harder to defend it. If combined Russian-separatist forces seize Pisky and other nearby locations, they might be able to use Donetsk Airport's airstrip for aviation.
Despite the Ukrainian Volunteer Corps' small size and lack of heavy weaponry compared to regular army units, it played a key role in Pisky due to its higher motivation and ability to act without bureaucratic restrictions, Engineer and Odin believe.
"The situation in Pisky is critical," Engineer said. "Most mobilized soldiers don't want to fight. They were torn away from their families."
Moreover, Right Sector fighters often acted as spotters, adjusting fire on enemy targets, and "soldiers complain that they were left without eyes," Megel said.
But Chorny, the commander of the 5th battalion, praised regular army units, saying they were able to protect Pisky and other positions.
He also complained that journalists had "created a Mecca out of Pisky" and said that there were other hot spots on the frontline that lack media attention, including Spartak and the Butovskaya Mine north of Donetsk.
The authorities' orders for Right Sector fighters to leave Pisky came as critics accused them of lacking discipline and professionalism but they say the opposite is true. Alcohol is prohibited at the base, and the corps has gradually stepped up army-style discipline.
Right Sector members also say that the corps has advantages compared with the regular army because its decision-making process is not thwarted by bureaucratic hurdles. "We can afford to do what the regular army can't," Chorny argued.
Another difference is much higher motivation. "Fighters clearly understand what they're fighting for," Megel said.
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#6
The Guardian (UK)
May 22, 2015
Ukraine bans Soviet symbols and criminalises sympathy for communism
New laws also honour controversialist nationalist groups that committed ethnic cleansing or allied with the Nazis for part of second world war
By Alec Luhn in Moscow
Two new laws that ban communist symbols while honouring nationalist groups that collaborated with the Nazis have come into effect in Ukraine, raising concerns that Kiev could be stifling free speech and further fragmenting the war-torn country in the rush to break ties with its Soviet past.
The first law "on the condemnation of the communist and Nazi totalitarian regimes" forbids both Soviet and Nazi symbols, making something as trivial as selling a USSR souvenir, or singing the Soviet national hymn or the Internationale, punishable by up to five years in prison for an individual and up to 10 years in prison for members of an organisation.
It also makes it a criminal offence to deny the "criminal character of the communist totalitarian regime of 1917-1991 in Ukraine" in the media or elsewhere.
The second law recognises controversial nationalist groups - including the Organisation of Ukrainian Nationalists (OUN) and Ukrainian Insurgent Army (UPA) - as "independence fighters" and makes it a criminal offence to question the legitimacy of their actions. While these two groups at different times fought both Soviet and German forces, they also collaborated with the Nazis and took part in ethnic cleansing. One of the authors of the law is the son of UPA leader Roman Shukhevych.
Supporters of the laws say they are a way to build a national identity and condemn totalitarianism, but the legislation has been roundly condemned by academics and human rights organisations, as well as Ukrainian activists. While other eastern European countries have also banned communist symbols, Ukraine's law is more wide-reaching than previous measures.
The laws could also have a divisive impact on a fragmented country in which many citizens, especially in the southern and eastern regions, are in favour of close ties with Russia rather than Kiev's pro-western policies and sympathise with the Russia-backed separatists in eastern Ukraine.
Long a hot-button issue, Ukraine's Soviet past has become especially contentious after the ousting of president Viktor Yanukovych last year and the conflict against Russia-backed separatists in two eastern regions, which has claimed at least 6,100 lives since April 2014. In what has become known as "Leninfall", activists have torn down more than 100 monuments to Vladimir Lenin around the country, sometimes clashing with pro-Russian protesters.
Two other laws taking effect on Thursday open up Soviet archives and officially replace the Soviet term "Great Patriotic War" with "second world war", in common with western countries.
In an open letter after the laws on independence fighters and communist symbols were passed by parliament, 70 scholars and experts on Ukraine from around the world called on president Petro Poroshenko not to sign them, arguing that their content contradicts the right to freedom of speech.
The letter read: "Not only would it be a crime to question the legitimacy of an organisation [the UPA] that slaughtered tens of thousands of Poles in one of the most heinous acts of ethnic cleansing in the history of Ukraine, but also it would exempt from criticism the OUN, one of the most extreme political groups in western Ukraine between the wars, and one which collaborated with Nazi Germany at the outset of the Soviet invasion in 1941. It also took part in anti-Jewish pogroms in Ukraine."
It warned that the "wholesale condemnation of the entire Soviet period as one of occupation of Ukraine will have unjust and incongruous consequences," noting that even someone who speaks positively of the perestroika market reforms under Soviet leader Mikhail Gorbachev, for instance, could be condemned.
Dunja Mijatović, the representative for the Organisation for Security and Cooperation in Europe on freedom of the media, said the "broadly and vaguely defined language" in the anti-communist law "could easily lead to suppression of political, provocative and critical speech, especially in the media". The US Holocaust Memorial Museum also condemned the independence-fighter legislation.
Even if the laws are not invoked to send souvenir sellers and historians to prison, they will promote ultranationalism and "anti-communist hysteria", said Denis Pilas, an activist with the Ukrainian group Left Opposition, who co-wrote a scathing analysis of the law in the journal Commons.
"The main danger of these laws is the movement of the political discourse to the right and the violence of the far right against leftwing activists," he told the Guardian. "It's a further step toward the legitimisation of these things - conservatism and violence against leftists - which have been growing for the past three to four years."
In addition, the anti-communist legislation could entail millions of dollars in expenses for renaming the huge number of cities, streets and other places connected with communist figures or the Soviet Union at a time when Ukraine is in economic crisis. Already local politicians have discussed a new names for the cities of Dnipropetrovsk and Kirovohrad, which were renamed in honour of communist revolutionaries Grigory Petrovsky and Sergey Kirov during Soviet times.
Also on Thursday, Ukraine's parliament passed a resolution abstaining from certain international human rights obligations, specifically to allow those detained on suspicion of terrorism in the "anti-terrorist operation" against separatists in eastern Ukraine to be held for more than 72 hours, as well as for the creation of military administrations in some cities.
According to Yulia Gorbunova of Human Rights Watch, the move is a legal step to allow Ukrainian authorities to deviate from certain norms in these treaties as they take measures against the separatist uprising, as long as these deviations are proportionate.
"They can deviate from certain human rights obligations because of the situation of emergency, but it is by no means carte blanche for human rights violations," Gorbunova said. "Where the state abused its right to deviate from human rights treaties, that will be decided by the United Nations Human Rights commitee or by the European Court of Human Rights."
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#7
Haaretz (Israel)
May 21, 2015
Ukraine to honor groups that killed Jews in World War II
New law outlaws the display of Nazi and Communist symbols but another law requires that nationalist groups involved in the killings of Jews and Poles be honored.
New Ukrainian laws that came into effect over the past two months will outlaw the display of objects and names from the country's communist past, while honoring groups that collaborated with the Nazis in the extermination of Ukrainian Jewry, Bloomberg reports.
A law signed by Ukrainian President Petro Poroshenko last week bans all Soviet and Nazi symbols, including town and street names.
It is expected to lead to the renaming such regional centers as Dnipropetrovsk (named after Grigory Petrovsky, who ran Ukraine in the 1920s and 1930s) and Kirovograd (bearing the name of Sergei Kirov, a Bolshevik leader allegedly killed by Stalin,) as well as dozens of other towns and hundreds of streets.
Another bill, signed into law in April, prescribes that Ukrainians honor a number of World War II nationalist organizations, some of which - such as the Organization of Ukrainian Nationalists and the Ukrainian Insurgent Army (UPA) - fought alongside the Nazis.
The law was protested by 40 historians from major Western universities in an open letter to Poroshenko and Ukrainian legislators.
"Not only would it be a crime to question the legitimacy of an organization (UPA) that slaughtered tens of thousands of Poles in one of the most heinous acts of ethnic cleansing in the history of Ukraine," the historians wrote, " but also it would exempt from criticism the OUN, one of the most extreme political groups in Western Ukraine between the wars, and one which collaborated with Nazi Germany at the outset of the Soviet invasion in 1941.
"It also took part in anti-Jewish pogroms in Ukraine and, in the case of the Melnyk faction, remained allied with the occupation regime throughout the war."
The Organization for Security and Cooperation in Europe also criticized the laws.
"Broadly and vaguely defined language that restricts individuals from expressing views on past events and people, could easily lead to suppression of political, provocative and critical speech, especially in the media," wrote Dunja Mijatovic, OSCE representative on freedom of the media, in April.
"As Ukraine advances on the difficult road to full democracy, we strongly urge the nation's government to refrain from any measure that preempts or censors discussion or politicizes the study of history," the U.S. Holocaust Memorial Museum said in a statement.
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#8
http://gordonhahn.com
May 20, 2015
UPDATED 'Right Sector' Leadership and Structure Update, 18 May 2015
By Gordon M. Hahn
Below I present the updated leadership and structure of Ukraine's influential neo-fascist movement and political party, Right Sector (Praviy Sektor or RS) as of 18 May 2015. Right Sector was founded on November 29, 2013 on the Maidan by three neo-fascist groups, including the notorious neo-Nazi party, the Social-National Assembly, of which the Maidan regime's first chairman of the Ukrainian Defense and Security Committee Andriy Parubiy was a founding leader (http://pravyysektor.info/appeals/pryvitannya-dmytra-yarosha-z-richnytseyu-pravoho-sektora/). Its leader, Dmitro Yarosh was appointed an advisor to the Ukrainian Armed Forces last month. RS's armed forces, the Ukrainian Volunteer Corps, has refused to subordinate itself to the Ukrainian armed forces' command, however. RS has claimed responsibility for the 2 May 2014 terrorist pogrom in which 48 people were killed, most of them burned alive.
RIGHT SECTOR - LEADERSHIP AND STRUCTURE, 18 May 2015
Central Leadership
Leader ("Coordinator") - Dmitro Yarosh, advisor to the Ukrainian Armed Forces General Staff
Deputy Leader - Andrei Tarasenko (political and social work)
Leader of Information Department - Borislav Beryoza (Ukraine Supreme Rada deputy)
Armed Forces
Ukrainian Volunteer Corps (DUK) Commander - Andriy Stempitskii
DUK Chief of Staff - Valeriy Voronov
Press Secretary - Artyom Skoropadskiy
Chaplain of DUK - Father Mikola Medynskiy-Zaliznyak (http://pravyysektor.info/news/kapelan-ps-o-mykola-medynskyj-zaliznyak-pro-informatsijnu-brehnyu/).
Regional Structures (leader)
Kyiv (Kiev city) - Volodomir Zagazei (2015). Predecessor: Andriy Tarasenko (2014)
Kyiv (Kiev) Oblast - Volodomir Gubok. Predecessor: Igor 'Topol' Mazur (2014)
Rivne Oblast - Roman Koval'
Ternopil Oblast - Vasil' Labaichyuk
Ivano-Frankivsk Oblast - Vasil' Abramiv
Zakarpatiya Oblast - Olaksandr Sachka
Sicheslavsk Oblast - Rostislav Vinar
Chernivetsk Oblast - Ivan Balandyuk. Predecessor: Volodimir Ryasov (2014)
Vinnitsa Oblast - Rostislav Romanyuk. Predecessor: Sergiy Chumak (2014)
Sumy Oblast - Vitaliy Lyashko. Predecessor: Mikola Surzhenko (2014)
Cherkask Oblast - Andriy Cherevan
Lviv (Lvov) Oblast - Artyom Lutsak
Zaporozhe Oblast - Oleksandr Taran. Predecessor: Sergiy Kanivets (2014)
Volyn Oblast - Serhiy Druzhinovich. Predecessor: Pavel Danilchuk (2014)
Odessa Oblast - Serhiy Sternenko
Donetsk Oblast - Serhiy Chirina (2015). Predecessor: Serhiy Volkov (2014)
Zhitomir Oblast - Artyom Bakhuro
Poltava Oblast - Mark Anatoliovich Chauso. Predecessor: Ivan Balatskiy (2014)
Kirovograd Oblast - Igor Svyatokumo
Chernogiv Oblast - Vladislav Litvin
Kherson Oblast - Dmitro Semyon. Predecessor: Volodimir Vedenko (2014)
Mikolaivsk Oblast - Mikhail Borsuk
Kharkiv Oblast - Andriy Sanin
Khmelnitskii Oblast - Anatoliy Medvedchuk
Media
PS newspaper Praviy Sektor" (1st issue, 21 August 2014)
http://pravyysektor.info
https://twitter.com/PravyjSektorRus
http://vk.com/yastrybd (Yarosh's VKontakt page)
http://vk.com/ps_kyiv
SOURCES: "Zvernennya Lidera 'Pravogo Sektora' Dmitra Yarosha," Pravyysektor.info, 15 July 2014, http://pravyysektor.info/news/zvernennya-lidera-pravoho-sektora-dmytra-yarosha-2/; "Organizatsiya," Pravyysektor.info, http://pravyysektor.info/organization/, last accessed 18 May 2015; http://pravyysektor.info/news/kapelan-duk-ps-ukrajina-bude-todi-koly-bude-ukrajinska-vlada/, last accessed 10 May 2015; http://pravyysektor.info/news/kapelan-ps-o-mykola-medynskyj-zaliznyak-pro-informatsijnu-brehnyu/; and http://issuu.com/33569/docs/ps_kinceve_2/1?e=13233382/9013358, last accessed 10 May 2015.
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#9
Washington Post
May 22, 2015
Editorial
The U.S. continues to send the wrong message to Russia
IT HAS been a week since Secretary of State John F. Kerry emerged from eight hours of meetings with Russian President Vladimir Putin and his foreign minister to say that the two sides had agreed to make a new effort to cooperate in resolving conflicts in Ukraine and Syria and completing a nuclear accord with Iran. The trip represented yet another bet by the Obama administration that it can cut deals with Mr. Putin without betraying U.S. interests or allies or capitulating to the Russian ruler and his imperialist agenda.
So far, the results are not encouraging. The starting point for any practical progress would be the actual implementation of a cease-fire in eastern Ukraine. Though the accord was signed three months ago, Russia's forces in the region continue to violate it "on a daily basis," as Assistant Secretary of State Victoria Nuland put it this week. That hasn't changed: On Wednesday, the Ukrainian military reported that "Russian-backed forces have continued to press their attacks on key points of the front...using heavy artillery and tanks," according to the Web site the Interpreter.
Nor has there been any alteration in Moscow's support for the Syrian regime of Bashar al-Assad. Despite the abundant evidence that Mr. Assad's forces have resumed using chemical weapons against civilians, in the form of "barrel bombs" filled with chlorine, Russia refuses to acknowledge Damascus's responsibility. After meeting with Mr. Kerry, Foreign Minister Sergei Lavrov said, "There should be no attempts to use the issue of alleged use of chemical weapons to exercise any political pressure" on the Assad regime.
Rather than confirm Mr. Kerry's wishful assertion that cooperation is possible, Mr. Putin's followers are crowing about what they describe as an American climb-down. Having failed to change Russian policy with sanctions and isolation, they say, President Obama has accepted that he must court the Kremlin and concede its core demands. Russian officials and media pointedly noted that Mr. Kerry did not challenge the Russian annexation of Crimea - the signal achievement of Mr. Putin's aggression - in the talks.
Mr. Kerry argues that "there is no substitute for talking directly to key decision-makers"; and it's true that there is some value in direct U.S. engagement with the Russian ruler, as opposed to a standoffish approach that leaves German and French leaders as the sole interlocutors. So far, too, the Obama administration has not altered its position on sanctions against Russia, which is that they can be eased only when the Ukraine cease-fire is fully implemented. Though both sides say that is their priority, it's unlikely to occur any time soon: Russia is using provisions in the agreement to demand a de facto dismantling of Ukraine while refusing to withdraw its troops or allow monitoring of the border.
Mr. Obama may believe that reengagement with Russia will facilitate his top foreign policy priority, the Iranian nuclear deal, while forestalling another escalation by Mr. Putin in Ukraine. But the Russian leader is more likely to be deterred by evidence that new aggression will be met by strong resistance on the ground - including through weapons supplied to Ukrainian forces - and by a firming of economic sanctions. Judging from Moscow's rhetoric, Mr. Kerry's outreach may have convinced Mr. Putin only that the Obama administration will eventually swallow his terms.
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#10
Moscow Times
May 22, 2015
Shoigu at 60: The Man Who Would Be Russia's King?
By Ivan Nechepurenko
Russia's Defense Minister Sergei Shoigu, a close ally, friend and rumored potential successor of President Vladimir Putin in the Kremlin, turned 60 on Thursday.
"A servant to the tsar, a father to soldiers," political pundits say of Shoigu - one of the country's longest-serving government officials - citing Mikhail Lermontov's poem and pointing to Shoigu's main political trait: loyalty.
For the three last years, Russians have named Shoigu "Person of the Year" behind only Putin, according to polls by the independent Levada Center. Last month, Shoigu took second place behind the president in a rating of Russian officials and politicians in which respondents were asked to choose several names from a list as the most trustworthy leaders. Shoigu was chosen by 26 percent of respondents, ahead of Foreign Minister Sergei Lavrov, who was named by 21 percent. Putin was chosen by 60 percent of respondents.
The polls were conducted among 1,600 respondents with a margin of error not exceeding 3.4 percent.
The political longevity and widespread public acclaim of Shoigu have prompted analysts to name him Putin's potential successor either at the next presidential election in 2018, or in 2024.
Pundits interviewed by The Moscow Times on Thursday put this hypothesis into doubt.
"No one with the surname Shoigu could ever be elected Russia's president," said Stanislav Belkovsky, a prominent political analyst, referring to the defense minister's origins from the remote Siberian republic of Tuva, where animistic shamanism is practiced by the population along with Tibetan Buddhism.
"Unlike the Soviet Union, Russia is a nation state, where only people with a Russian surname can occupy the Kremlin," Belkovsky said in a phone interview.
At his 2013 call-in show, Putin was asked whether he considers Shoigu his future successor.
"The people of the Russian Federation will choose my successor," Putin responded.
Other analysts said it is too early to predict Putin's eventual successor, and that Putin may remain in office for the rest of his life.
The Shoigu Story
Shoigu was born to an ethnic Russian mother and an ethnic Tuvan father in Tuva near Siberia's Altai Mountains. For years, rumors swirled that Shoigu practiced Buddhism or shamanism, but in a 2008 interview with Ekho Moskvy radio station he said that he was baptized in the Orthodox faith at the age of 5. In a heavily publicized move on May 9, Shoigu crossed himself beneath one of the Kremlin towers minutes before the Victory Day military parade in Moscow.
A construction engineer by profession, Shoigu's career took off fast. At the age of 28, he oversaw 10,800 prisoners working on the construction of the huge Sayanogorsk aluminum plant in the Siberian republic of Khakasia. More than 10 years later, one of Russia's richest men, Oleg Deripaska, would begin his career there.
Later Shoigu had to manage far larger groups of people. By the 2000s, the Emergency Situations Ministry that he had set up in 1994 had grown into a 350,000-strong operation with its own special forces, according to the Vedomosti business daily.
In 1993 he helped Boris Yeltsin with manpower and weapons in the latter's standoff with parliament, earning his lifelong trust. Before Putin came to power in 1999, Shoigu was considered a potential successor to Yeltsin.
During his time as emergencies minister, Shoigu unfailingly appeared at all major disasters, and sometimes at minor ones, stoically standing with barely a muscle moving in his face. In these appearances, his precise, short orders and comments to the media radiated a sense of confidence that most Russians had longed for.
Political Asset
Over time, Shoigu became a very attractive figure for politics. In 1999 he was chosen to lead the Unity party in the 1999 State Duma elections. In an alliance with the Fatherland-All Russia political bloc, that party later morphed into United Russia, the country's current ruling party that rubber stamps Putin's initiatives in the Duma.
Shoigu has been one of Putin's closest allies since that time. In 2012 he was appointed defense minister after a series of corruption scandals brought the reign of his predecessor Anatoly Serdyukov to an abrupt end. Under Shoigu, Russian soldiers have executed the annexation of Crimea and been accused by Ukraine and NATO countries of fighting with pro-Russian insurgents in Ukraine's east.
"Russia's sovereignty, which is secured by its army and navy, will always be the obstacle against which during the 1,152 years of Russia's existence many Western rulers have broken their teeth," Shoigu told the TASS news agency in October.
In November 2013, a year after he took the helm of the Defense Ministry, the state-run pollster VTsIOM conducted a survey of Russians' attitudes toward Shoigu. At the time, 46 percent said that they respected him, 35 percent said they trusted him and 15 percent said they sympathized with him.
The poll was conducted among 1,600 people with the margin of error not exceeding 3.4 percent.
Even political enemies of Putin such as Boris Berezovsky and Boris Nemtsov called Shoigu a decent and competent man, as reported by Vedomosti.
Over the years, Putin has become friends with Shoigu, with whom he apparently shares a love for wild nature and fishing. In 2013, Shoigu took Putin fishing in his native Tuva, where Putin was reported by media to have caught a 20-kilogram pike and stayed in a traditional yurt.
Despite his considerable political capital and the support of the general public, Shoigu has consistently stayed away from politics. This has earned him a reputation as Putin's "do it" man and could explain, analysts say, why he has never been removed from government as a potential political threat.
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#11
Wall Street Journal
May 22, 2015
Move to Shift Vote for Russian Duma Seen Benefitting Putin
Support grows for holding parliamentary elections three months earlier, in September 2016
By PAUL SONNE
MOSCOW-Senior ruling-party politicians are throwing their weight behind a proposal to move Russia's next parliamentary elections up three months to September 2016, a shift that could put opposition candidates at a further disadvantage by relegating the campaign to vacation season.
Sergei Naryshkin, leader of parliament's lower chamber and a member of President Vladimir Putin's ruling United Russia party, on Thursday called the rescheduling proposal "possible and even wise," according to the Interfax news agency. The reason he gave was that budgets are passed in the fall and it would make more sense to elect new lawmakers beforehand.
Other backers have argued it would be more efficient to hold parliamentary elections on the same day as local and regional ones, which are held in September.
Critics see the shift as a bid by Mr. Putin's allies to ensure an easier ride for the ruling party, as looming budget cuts and economic woes start to weigh on public opinion. Although Mr. Putin's personal ratings remain high, the last parliamentary elections, in December 2011, led to mass protests against voting fraud, which posed the biggest ever public threat to his rule.
September elections would make the sleepy month of August the prime campaign season, which analysts said would make it harder for challengers to reach potential voters.
"If the elections are in September, it's helpful for the status quo, for the active political parties, because the election campaign essentially goes unnoticed," political strategist Mikhail Vinogradov said.
Changing the date could also backfire if voters believe the government is doing so for political gain. If the popular mood sours, it would prove difficult to shift opinion significantly during a summer campaign, he said.
In recent days, governors across Russia have been triggering early elections for their posts by formally tendering their resignations to Mr. Putin before the expiration of their terms.
The resignations give the governors a chance to secure re-election in September, before the full impact of a deteriorating economy and budget cuts hits home. At least six governors formally tendered their resignations this month.
There are few immediate signs of concern among top officials about public support. The conflict in Ukraine has decelerated, and the ruble has rebounded. The economic turmoil wrought by low oil prices and Western sanctions so far has proved less severe than many Russians feared late last year.
Still, asked to evaluate developments of the past year, 69% of Russians said the changes were for the worse, compared with 43% who said so in October, according to a March poll by the Institute of Sociology at the Russian Academy of Sciences, published Thursday in the newspaper Vedomosti.
Russia's parliamentary elections have been held in December since 1993. On Wednesday, Valentina Matvienko, leader of the upper house of parliament, who also belongs to United Russia, backed moving them to the same day as the local ones in September.
However, changing the date for parliamentary elections may require a constitutional amendment. Vladimir Pligin, head of the parliament's committee on constitutional law and nation building, told Interfax that he planned to discuss how it could be done with legal experts.
The proposal has the support of an "absolute majority" of the Russian parliament's lawmakers, apart from the Communists, the second-largest faction, who remain divided, leader of the pro-Putin LDPR faction Vladimir Zhirinovsky told a radio show. The Communist Party of the Russian Federation didn't respond to a request for comment.
Earlier this year, Mr. Putin signed into law changes to the makeup of Russia's lower house of parliament. In the next election, half of the 450-person chamber will be made up by directly elected candidates. The other half will be made up of party-list seats allocated to all factions that receive more than 5% of the vote, based on their share of the vote. Currently, all candidates are selected via a party-list system.
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#12 Brookings Institution May 18, 2015 The ruble currency storm is over, but is the Russian economy ready for the next one? By Sergey Aleksashenko Sergey Aleksashenko is nonresident senior fellow in Global Economy and Development. Former deputy chairman of the Central Bank of Russia and former chairman of Merrill Lynch Russia, he focuses on transition process in CIS and Eastern Europe, monetary policy and international financial infrastructure. [Charts here http://www.brookings.edu/blogs/up-front/posts/2015/05/18-russian-economy-aleksashenko?cid=00900015020149101US0001-0520] Recent data show the Russian economy contracted 1.9 percent in the first quarter of 2015. In this article, Sergey Aleksashenko delves into the events that led to the downturn, and what we can expect for the rest of 2015. When the Russian ruble collapsed in mid-December last year, losing one-third of its value in three weeks, some experts forecasted a drastic downswing for the Russian economy in 2015 exceeding 10 percent of GDP. But five month later, the ruble has bounced back; the Russian stock market index has risen 25 percent since January 1st, while the Russian economy's slide in the beginning of 2015 has been about 2 percent. While the current crisis in some ways mirrors the 2008-2009 financial crisis, with both involving a fall in oil prices and a lack of access to foreign capital markets, this time is different. Russia suffered during the previous crisis because of a collapse in bank financing of commodities trading, hitting Russian extractive industries hard. This time, the negative trends that will play a role in the coming quarters are mainly of domestic origin, with some of them linked to the ruble collapse in December 2014. Thus, it is too soon to write off the December episode as having caused only minor damage to the Russian economy. December's perfect storm: The ruble collapses A sharp drop in the ruble at the end of last year was influenced by several factors combined: Oil prices fell more than 60 percent from mid-summer, hitting a low of $48 per barrel of Brent. As oil represents 50 percent of Russian exports in value, that removed a significant portion of foreign-exchange supply. Chart 1. Oil Price (USD/bbl) and Ruble Exchange Rate (BCB[1]/100RUB) in 2011-2015 (10-day moving average) Sources: U.S. Energy Information Administration and Bank of Russia. Russian banks and corporations needed to buy foreign currency to pay off debt in the domestic market because Western sanctions meant they were unable to raise capital in global markets. The amount of debt to be repaid within the last quarter of 2014 exceeded $60 billion, some 15 percent of GDP for the fourth quarter. By mid-November, the Central Bank of Russia (CBR), pursuing a policy of a managed ruble rate and having spent $90 billion (17.5 percent) of its foreign-exchange reserves since the beginning of 2014, decided to move to a floating exchange rate regime. But in spite of its decision, the CBR continued to sell reserves and could not give any coherent explanation for its actions, which gave rise to a high degree of distrust of the monetary authorities. The state-controlled oil company, Rosneft, was due to make the largest repayment of foreign debt ($14 billion between December and February-a quarter of all payments), but did not have enough liquidity either in rubles or in dollars. To support the company, the CBR implemented a special refinancing scheme that further undermined market confidence. When the ruble's slump began to accelerate in December, the indecisive and delayed actions of the CBR were received negatively by the markets. The sharp depreciation of the ruble provoked a household run on the banks. Depositors wanted to convert ruble savings into foreign currency, purchasing $22.5 billion during the fourth quarter. Furthermore, rumors about the possibility of currency regulation restrictions incentivized depositors to retain a significant portion of currency at home. The outlook brightens But the effects of the December storm appeared short-term and more concentrated in the financial sector; the real sector of the Russian economy seemed to be relatively stable. Manufacturing was growing due to an extensive rise in military procurement, at around 20 percent per year. Agriculture benefited from a good harvest and the food industry was buoyed by the food import embargo imposed by Russian authorities in August. Despite the decline in oil prices and other commodities, Russian producers have not reduced their exports and, thus, physical volumes of production have not suffered. Moreover, the Russian oil industry produced a record high 10.67 million barrels per day (bpd) in December, and set a new record of 10.71 million bpd in March.[2] At the beginning of 2015, the situation in the financial markets started to improve. The ruble has bounced back to its mid-November level, and the Russian stock market index has risen 25 percent since January 1st. The most important factor was a 30 percent bounce in oil prices by mid-April that increased export revenue and boosted the business mood of many Russians who feel their success relies on oil prices. An increase by the CBR of its key rate to 17 percent provoked a jump in ruble deposit rates by up to 25 percent and stopped the outflow of deposits. Moreover, recognizing that the exchange rate had stabilized, some households began to sell foreign currency-around $4.5 billion was sold during February and March. In addition, the foreign debt repayment schedule softened significantly in the first quarter-the amount due decreased by 40 percent compared to the previous quarter, to $36.5 billion. CBR data show that repayments in 2015 and 2016 will be even less, thus diminishing the future direct impact of Western financial sanctions.[3] Chart 2. Quarterly Repayments of Russian Foreign Debt in 2014-2016 (USD in billions Source: Bank of Russia. From the end of December 2014, the CBR, instead of selling foreign-exchange reserves in the open market, began to actively provide banks with loans in foreign currency that reduced demand in the market. Banks that obtained foreign currency loans repurchased Russian sovereign Eurobonds-that were used as collateral against Bank of Russia loans-compressing the spread for 10-year Eurobonds from 480 basis points in mid-December 2014 to 170 basis points in April 2015. All this initially led to the stabilization of the ruble rate, and then-when all these factors were boosted by a powerful inflow of carry-trade capital looking for high-yield local bonds-the ruble started to strengthen rapidly. Moreover, in mid-May the CBR became uptight by the speed of the ruble strengthening and has now recommenced its currency interventions-by purchasing foreign exchange in the market-thus demonstrating its inconsistency in maintaining the ruble free-float regime. As the situation on the forex market calmed down, it appeared that the slowdown in the economy was not as severe as anticipated. Russian President Vladimir Putin has declared that the economy has weathered the storm and is going start to recover. So is he right? Dark skies on the horizon: A forecast for the Russian economy in 2015 While the Russian financial markets may currently be basking in a recovery few could have predicted just months ago, the Russian economy is likely to suffer from secondary effects of the ruble collapse. The key economic challenges for 2015-2016-elevated inflation, a destabilized budget and a continuing decline in investment-suggest dark clouds are on the horizon for the months ahead. Let me explain in more detail. Inflation could remain stubbornly high Inflation began accelerating in spring 2014 after the ruble lost 10 percent of its value over the course of January and February. Prices rose further in August 2014 after Russia imposed an embargo on food imports that reduced the supply of many products. Inflation was then further fueled by the sharp devaluation of the ruble. As a result, by April 2015 inflation had reached 17 percent. An immediate consequence was a sharp decline in household living standards. Real wages in the first quarter of 2015 decreased by 9 percent, and retail sales dropped by 8 percent compared to the previous year. The Russian government predicts a gradual decline in inflation to around 12 percent by the end of 2015, while the CBR has kept its inflation target of 4 percent in 2017 untouched. However, these estimates make no account for three potential threats, any of which could add 1.5-2 percentage points if realized: A spike in food prices. Food inflation in Russia strongly depends on the harvest in Russia and the rest of the world. Food makes up about 40 percent of the country's consumer basket and, as a grain exporter and net importer of many basic products (e.g. milk, meat, vegetable oil, sugar), Russia is quick to feel price shocks; A new devaluation spiral. This could come about due to the excessive strengthening of the ruble in March and April, or a decline in oil prices, or the seasonal jump in demand for foreign exchange that regularly weakens the ruble in August and September; The inflationary effects of the budget deficit. The use of fiscal reserves sets off the same inflationary effects on the economy as monetary financing of the deficit by the CBR. If, in 2015, the reserve fund is used to the extent accepted by law, it would be equivalent to an increase in reserve (high-power) money by about 10 percent. Balancing the budget won't be easy Over the past 15 years, Russia has enjoyed a comfortable fiscal situation: rising oil prices and stable economic growth allowed it to erase the deficit, minimize public debt, increase public spending, and fuel fiscal reserves. However, the increase in expenditures distorted the structure of the budget, with accelerated growth in social entitlements (pensions and wages) and selected expenditure programs (law enforcement agencies and military spending), while expenditures on human capital and infrastructure grew very slowly. Oil revenues make up 52 percent of the federal budget, so when oil prices slumped in late 2014 and economic growth slowed, the Ministry of Finance estimated budgetary revenues would decrease by 20 percent. At the same time, inflation and the devaluation of the ruble required increases in spending in many areas. A revision of the budget for 2015 undertaken in February and March attempted to cut expenditures by 10 percent.[4] But the actual reduction was just 2 percent, as all "savings" were used for the indexation of pensions and to compensate for cost increases for favored sectors. Despite these measures, the federal budget deficit is still projected to reach 3.7 percent of GDP in 2015. Financing the deficit should not cause problems for the government this year, even with limited access to global capital markets, as accumulated fiscal reserves account for about 10 percent of GDP. However, a much more serious challenge awaits the government in planning the budget for 2016-2017. Oil prices have rebounded slightly since the lows of December 2014, but one can hardly expect them to return to above $100 per barrel any time soon. Although the Ministry of Economic Development is hoping for a return to growth, the IMF, the World bank, and the EBRD say there is a high probability of continued decline of around 1 percent in 2016. This means that budget revenues will likely remain low, while a significant share of expenditures have to be indexed according to inflation (social benefits, wages, defense, etc.). In addition, the Ministry of Finance is determined to eliminate the budget deficit by 2017, which will increase pressure for additional budget cuts and will reduce the quality of services in the public sector. The banking sector remains shaky The collapse of the ruble and stock market last December caused serious damages for the Russian banking sector. Trying to soften the blow, the CBR extended its credit activity (both in rubles and dollars) and announced a set of measures to provide temporary relief in prudential regulation. Initially those measures were scheduled to last until mid-2015, but banking lobby is requesting their extension until the end of the year. The recovery of the financial markets in the beginning of this year made life easier for the banking sector, though since spring banks have faced a sharp deterioration in the payment discipline of borrowers. CBR statistics show that the financial position of big banks is relatively worse. That may lead to growing demands for budgetary bailouts in the near future. Investment-led decline will continue The Russian economy started to slow down well before the annexation of Crimea and Western sanctions-the growth rate had been steadily falling since the end of 2011. The driving force of this process has been growing capital flight and declining investment activity in the economy. After the Russian financial crisis of 1998, there was a rather stable ratio between investment growth and growth of GDP-around 2-to-1. But as investment growth in the private sector started to evaporate, the economy started to break. Moreover, due to the austerity approach of the Ministry of Finance, public investment will continue to decline. Minister of Economic Development Alexey Ulyukaev predicts the share of the budget in overall investment is going to decline from 20 percent in 2013 to less than 10 percent in 2018. The structure of Russian imports-50 percent machinery, 25 percent consumer goods, 25 percent intermediaries-makes evident that the bulk of the balance of payments adjustment (Russian imports have contracted by 40 percent in the first quarter of 2015 compared to 2013) will coincide with a further decline in investment, which may not have a major negative impact on 2015 GDP dynamics but will certainly undermine growth prospects for the coming years. As economists and meteorologists alike will attest, predicting the future is an unenviable task. Those of us in the business of forecasting are only ever one bad prediction away from ridicule. But the omens for Russia are not good. This year Russia may face 3 to 5 percent GDP decline, and cannot expect to return to sustainable growth any time soon. Stagnation looks likely. Throw in high inflation, and the outlook for the Russian economy for the coming years looks decidedly bleak. Keep your umbrella at the ready. [1] Since 2005 the Central Bank of Russia has managed the ruble rate versus BCB-bi-currency basket-composed out of USD (55 percent) and Euro (45 percent). [2] Sectorial oil and gas sanctions are applied to Arctic deep-sea and shale exploration. Those projects are currently in the earliest stages of geological study and none of them is being developed at the moment, meaning sanctions have no impact on the current volume of Russian hydrocarbon production. If sanctions remain in place, some experts argue their first effects may become visible within 18 to 24 months. [3] Taking into account that approximately one-third of Russian corporate debt is enabled by shareholders-allowing them to minimize taxes-and is usually rolled over despite market conditions, the net repayment of the debt may reach $80 bln in 2015 and $45 bln in 2016, or 5 percent and 3 percent of estimated GDP in 2015 at the current ruble exchange rate. [4] Those cuts were not proportional. For example, military expenditures were not touched while road construction was cut by 20 percent and all investment projects that could not be finished in 2015 were deprived of funding. |
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#13
Russia Beyond the Headlines
www.rbth.ru
May 21, 2015
TROIKA REPORT: Hopes of a reset for U.S.-Russia relations, the implications of a sanctions-free Iran, why India-China rapprochement suits Moscow
RBTH presents its weekly analytical program TROIKA REPORT, featuring a look at three of the most high-profile recent developments in international affairs.
BY Sergey Strokan and Vladimir Mikheev
1. Engaging the West
Can 'hawks' reset U.S.-Russia relations?
Russian hopes for a new "reset" in U.S.-Russia relations suffered a setback less than a week after U.S. Assistant Secretary of State Victoria Nuland's visit to Moscow. Contrary to expectations, no progress was reported as a result of Nuland's whistle-stop visit.
Russian Deputy Foreign Minister Sergei Ryabkov described the state of bilateral dialogue as "deplorable." Ms. Nuland, in turn, termed the talks she held in Moscow in the Russian MFA "detailed" and "pragmatic" but without a hint of any possible breakthrough.
In fact, Nuland's statements revealed that Washington is looking for a new role: to supervise the Ukraine peace talks while not becoming formally involved. The welcome news in this context was the statement by Nuland that the U.S. is seeking to influence the implementation of the peace deal and regards the Minsk agreements as the basis for a settlement.
In an apparent attempt to boost and highlight the United States' role in resolving the crisis, Ms. Nuland announced that she had personally received assurances from Ukrainian President Petro Poroshenko that Kiev had no intention of playing the role of the aggressor by restarting hostilities in the Donbass. Given the special relationship between the Obama administration and the government in Kiev, the latter is now committed to honoring its promise to its main financial donor not to launch any offensives in eastern Ukraine. The question is now whether Russia can ensure the Donbass rebels will also refrain from fresh attacks.
Prior to the visit some Moscow commentators nurtured a rather slim hope that a diplomatic breakthrough was in the making. But since the talks focused on the contentious issue of the Ukrainian crisis, now in its second year, there were few chances from the outset for either a "quick fix" or a "benign neglect" attitude on the part of Moscow or Washington.
Nevertheless, Ms. Nuland's visit came hard on the heels of U.S. Secretary of State John Kerry's much-hailed talks with Russian President Vladimir Putin and Foreign Minister Sergei Lavrov in Sochi, where the two sides reportedly agreed that efforts should be made to improve bilateral relations.
Does the visit by Ms. Nuland offer any tangible opportunities for an improvement in bilateral relations? Andrei Kortunov, general director of the Russian Council for International Relations, provided a comment for Troika Report:
"We can hope that the visit could be a turning point, that we have hit the bottom and started to overcome the crisis in our relations. It is too early to make final conclusions but it is important that Victoria Nuland was in Moscow, and it is important that both sides intend to restore the direct line of communications between the U.S. State Department and the Russian Foreign Ministry. I hope this visit will generate some practical results not limited to the Ukrainian crisis, although, definitely, this crisis is at the center of the problem and has to be addressed."
- Do you not find it surprising that a conciliatory tone was expected from a person with a reputation of playing the "bad cop" towards Russia?
"It has been a standing tradition that whenever the United States wants to correct its relations with Russia it usually dispatches someone who is recognized as a "hawk" and not a "dove." I think Victoria Nuland has credibility (in the first capacity) and would not be criticized by neo-cons, who would otherwise consider these moves as the U.S. administration making concessions to the Kremlin. She is the right choice. We should also keep in mind that Victoria Nuland is the person 'behind the lines' in the relations between the U.S. and Ukraine. Therefore, she is in the best position to explain the situation in Kiev, the opportunities and the limitations related to the current Ukrainian leadership."
Notably, Deputy Foreign Minister Sergei Ryabkov reiterated that Moscow was ready to continue dialogue with Washington on all contentious issues, particularly in the military and political spheres. Despite the accumulated skepticism, both sides might be inching towards some sort of understanding, after all.
At least, this is something hoped for by pragmatic political figures and is essential for both regional and global stability. Troika Report duly notes the "wishful thinking" of some Moscow-based foreign policy analysts. It betrays the general feeling of psychological weariness regarding the ongoing war of sanctions and war of words. Could there be a similar weariness among policymakers in Washington?
2. Globally speaking
Bringing Iran in from the cold: What's in it for Russia?
Who stands to benefit more from the return of Iran to the mainstream global economy and politics? Will Russia capitalize in full on the lifting of the restrictions around its powerful neighbor on the rise?
The answers are conditional on the outcome of the final round of negotiations between the P5+1 and Iran, which started on May 19 in Vienna. Drafting of the conclusive agreement on the Iranian nuclear program in order to meet the June 30 deadline is already underway.
The deal could still be scrutinized on Capitol Hill in Washington. Moreover, in March, 47 Republican U.S. senators have threatened Tehran that they would revoke the deal once Barack Obama vacates the White House.
Yet Obama's administration has a firm intention to win over Iran to its side as a long-term goal, substituting or probably replacing its former strategic allies, now in decline. Obama has even managed to convince the Gulf petro-monarchies to relinquish its staunch opposition to a deal with Iran.
In this context, what are the stakes for Russia in the agreement to roll back the Iranian nuclear program? The answer was provided for Troika Report by Dmitry Polikanov, Member of the Executive Board of the Moscow-based PIR Center think tank:
"This deal will finalize a long process of negotiations and mark the end of the "era of confrontation" between the West and Iran. The most important element on what Russia insists is that any solution should not become a precedent. Russia is trying now to avoid a repetition of the American practice of creating precedents, and wants international law, including the involvement of the United Nations, to be applied to the Iranian case. The solution now discussed should be based on the basic principles of the International Atomic Energy Agency and should be aligned with the lifting of sanctions.
- The abandonment of sanctions would allow Iran to become a full-fledged member of the international community. What opportunities does it open for Russia and its partners in the CIS?
"The elimination of sanctions will lead to a surge in the trade turnover between Russia and Iran. There are a lot of things which we could do together including cooperation in industry and energy fields. Iran is a potential big purchaser of Russia-made armaments."
"The only thing we should take into account is that Iran is a major player on the oil and gas market. So Russia might face growing competition."
Russia' stance on engaging Iran is determined by two considerations. First, Moscow would not be happy should Iran arbitrarily storm into the exclusive club of nuclear powers as its 10th member: It would then lure Saudi Arabia into becoming the 11th participant (Riyadh recently showed interest in purchasing an atomic bomb from Pakistan), make Israel fidgety and less predictable, and thoroughly destabilize the whole region.
Second, Moscow is gambling on untapping Iran's 80-million consumer market with its huge growth potential. It welcomes a peaceful atom-based energy strategy from Iran since Russia has a competitive edge in offering state-of-the-art and secure technology for nuclear power plant construction.
In April, Russian President Vladimir Putin lifted a self-imposed ban on delivering the S-300 anti-missile rocket system to Iran in anticipation of a comprehensive deal on its nuclear program. The move provoked a highly nervous reaction in the U.S. and Israel.
Apart from dumping a serious irritant between the two governments (after Moscow canceled the supply contract in 2010 under pressure from the West), it will serve as a probable deterrent to a potential missile attack on Iranian nuclear power generation facilities and other strategic installations.
Additionally, with the delivery of the S-300, Moscow is positioning itself as a provider of additional national security for Tehran, and probably expects to be paid back with preferential treatment. This all the more relevant given a plethora of indications that European business is in the "ready, steady, go" mode, eager and ready to engage the de-sanctioned Iran in trade and economic cooperation.
Meanwhile, according to unconfirmed reports, Moscow has already entered into a barter deal with Tehran and started deliveries of Russian-made construction materials and machinery, and also grain in exchange for crude oil.
In sum, the race for the Iranian domestic market and for sourcing from its oil and gas export potential is gearing up. Moscow would not want to be lagging behind.
3. Going Eastward
Moscow smiling as India and China mend fences
Foreign policy is often about symbols and perceptions, as explicitly proved by the recent visit to China by Indian Prime Minister Narendra Modi. The watershed event has opened a window of opportunity for an accelerated warming up of relations, and this is more than just good news for Russia.
Despite a bitter legacy of past conflicts and contemporary rivalry, Mr. Modi's three-day tour sent a signal that the two powerhouses, with their high economic growth and home to a third of the planet's population, have finally realized that the moment is ripe, if not overripe, to patch up old quarrels and join forces to shape the emerging "brave new Asia."
The long-lasting animosity has roots in the border dispute dating back to 1914. Britain, the colonial master of India at the time, drew out the so-called McMahon Line, which was not accepted by China as a formal boundary. The border dispute eventually provoked a war in 1962, and its scars are still felt by both sides.
This time, Prime Minister Modi and China's Premier Li Keqiang have agreed to seek a "fair resolution" to border disagreements and let bygones be bygones. As Li pointed out, the two countries have "enough political wisdom to manage and control" differences, adding that "our common interests are far bigger than our differences."
This step forward in relations between Delhi and Beijing was backed up by 21 signed agreements and MoUs estimated to be worth $22 billion. The envisaged cooperation covers a range of areas of mutual interest like manufacturing (steel and metals), power generation infrastructure, small & medium business, and the film and entertainment industry.
Both nations can benefit from the positive engagement. India has a huge appetite for foreign investments given Narendra Modi's commitment to the grand vision of the "Make in India" policy, while China can tap the no less promising consumer market of India by adding it to its end-user list.
To assess the true value of Modi's visit, Troika Report approached Brian Yeung, an independent financial analyst in Hong Kong, who says that it could become "a game changer in Sino-Indian relations and the world of emerging economies." Here is what Yeung had to say:
"The past few years have seen an increasingly strained relationship between the two rising powers in Asia and their trade deficit soared from $1 billion in 2001-2002 to $38 billion last year. Measures to tackle trade deficit such as signing MoUs to improve market access topped the agenda for this visit.
"Given India's strategic importance to China's 'One Belt, One Road' initiative as well as the BRICS alliance, an improved economic partnership between China and India will carry significant implications for the world's economy. As the SCO and the BRICS summits are just two months from now, we are expecting a new golden age for the Asian economy and a brave new world defined by the Global East."
A similar positive appraisal was made for Troika Report by Manish Chand, CEO and founder-editor-in-chief of the India Writes Network, who called the visit "a milestone" and predicted that it will chart "a roadmap for the long-term development" of India-China relations. Chand also placed it in a wider context:
"Overall, Prime Minister Modi's visit, coming as it does barely months after Chinese President Xi Jinping's visit, underscores the strategic intent of the two Asian giants to build up a narrative of win-win cooperation in shaping an Asian century, rather than the construct of rivalry, as conjured up in sections of the Western strategic circles and media."
It is noteworthy, that on the eve of his departure for China, Modi phoned Russian President Vladimir Putin and confirmed his attendance of the Shanghai Cooperation Organization (SCO) summit in Ufa this July.
Since the SCO is evolving into a formidable union with enormous potential for growth, the dismantling of roadblocks in the turbulent relationship of the two Asian majors would serve as an impetus for further economic integration which, invariably, requires a high level of political coordination or at least putting aside differences. The India-China joint statement specifically noted that both sides intend to show "respect and sensitivity to each other's concerns, interests and aspirations."
Moscow has a big stake in smoothened interaction between Beijing and Delhi since it paves the way for molding a "triangle" of nations capable of playing a significant role in ensuring global stability.
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#14
Russia Beyond the Headlines/Rossiyskaya Gazeta
www.rbth.ru
May 20, 2015
Sergei Lavrov: Talk of U.S.-Saudi conspiracy over oil market is misguided
Was the fall in oil prices a conspiracy between the U.S. and the Saudi sheiks? Would Russia be ready to help the United States if the need arose? Russian Foreign Minister Sergei Lavrov responded to these and other questions during a recent visit to the office of Rossiyskaya Gazeta.
Nikolai Dolgopolov, Yevgeny Shestakov, Rossiyskaya Gazeta
Rossiyskaya Gazeta: Is the U.S. pressure on Europe really that strong?
Sergei Lavrov: The pressure that the U.S. exerts is indeed strong. U.S. Secretary of State John Kerry constantly told the Russian president and me, and with great resolve, that everything that is written in Russia about America being against us, creating intrigues against us, against our partners, that America is plotting some kind of "color revolution" is not true. America is not working against us, America is interested in a strong democratic Russia, he would say. All this is for the benefit of solving important problems that concern American interests. But on several occasions I gave him lots of examples of America exerting pressure on its allies.
But in the European Union there is always light at the end of the tunnel. Some Europeans do not want to worsen relations with Russia. They do not want to see what is happening now.
The most important thing is that now we have the Minsk document, which can be shown as a reference point to those who are demanding certain actions from us. Read the text of the Minsk agreements: Control of the border must be established at the very end of this process. They leave aside the fact that Kiev is obliged to introduce a law on special status and instead turn everything upside down by saying that this is not special status, but occupation. After that it is impossible to justify the preservation of Ukraine's economic blockade of the Donbass.
R.G.: Sometimes we get the impression that Ukrainian President Petro Poroshenko is vacillating between Europe and America.
S.L.: To a certain extent, yes. But he needs to do so in order not to have the Americans work against him. But when Petro Alexeyevich Poroshenko speaks to Russian President Vladimir Vladimirovich Putin on the phone or when, for example, they held talks in the Normandy Format [the expression used in Russia for the four-party format of peace negotiations on Ukraine (Russia, Ukraine, Germany, France)], he tries to be pragmatic and solve some problems.
R.G.: In your opinion, what does the future hold in store for the DNR and LNR?
S.L.: On all levels, in comments made by the Russian president and in other formats we always say that we want the republics to be a part of Ukraine. They have just presented their constitutional project, which perfectly outlines the status that is included in the Minsk agreements: The republics will be a part of Ukraine and later they will hold a constitutional reform to strengthen this status on a permanent basis. The project defines what is meant by de-centralization. Moreover, it was German Chancellor Angela Merkel and French President Francois Hollande who wrote that definition in Minsk.
R.G.: Does the fact that during the press conference in Sochi U.S. Secretary of State John Kerry made no mention of Crimea mean that the U.S. accepts the existing state of things?
S.L.: Not only did he not mention Crimea during the press conference, he also did not speak about it with Vladimir Putin or with me. Draw your own conclusions.
R.G.: In your view, is the fall of oil prices a conspiracy between the U.S. and Saudi Arabia?
S.L.: I don't think so. You see, there are many factors at play here. Would the Americans really invest billions of dollars in the development of shale gas, with all its ecological risks, only to "hound" us? That is, they also do damage to themselves since due to the fall in oil prices most of the shale gas deposits in the U.S. have lost their profitability. That means that the American administration would have had to tell the private companies that are developing the shale resources, "Colleagues, you will suffer greatly, but you must endure it." I really don't think so.
China's growth has slowed down a bit (and for the Chinese economy even one percent is already a lot) and this has immediately affected everyone. The Saudis do not want to reduce their production or export, even though they are already suffering. They foresee a deficit in their budget, taking into consideration Saudi Arabia's colossal plans. But they do not want to reduce the production for one simple reason: If they leave one market or another, someone else will take their place. They don't like this.
I do not think this was a conspiracy. Even though many say that due to this Russia's oil platform is being pulled from under its feet. But I would not support the conspiracy theory.
R.G.: Would Russia come to America's aid if the U.S. needed help?
S.L.: I will remind you that in 2001 the Russian president was the first to call U.S. President George Bush after the terrorist act of September 11 [in 2001]. We offered our help immediately back then. Then we established a dialogue on the fight against terrorism, even though we did not always feel honesty on the part of our American partners.
Nevertheless, whenever America found itself in trouble, whether it was a terrorist attack or a natural disaster, floods in particular, we always offered help. Our people, I think, have it in their blood to help those in trouble.
First published in Russian in Rossiyskaya Gazeta.
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#15 Russia Insider www.russia-insider.com May 22, 2015 EU Prepares to Abandon Ukraine Kremlin discloses details of high-level negotiations with EU that would change Association Agreement beyond all recognition, forever ending any prospect of Ukraine's integration with the West and the EU By Alexander Mercouris Russian President Vladimir Putin's website is providing fascinating details of a high level government meeting that took place in the Kremlin on 20th May 2015. [ http://en.kremlin.ru/events/president/news/49495] The meeting covered a broad range of economic issues, but I shall focus here on one particular issue, which is what the report tells us about the state of the tripartite negotiations Russia is having with the EU and Ukraine over Ukraine's Association Agreement with the EU, and what the negotiations also tell us about the strength or otherwise of the EU's commitment to Ukraine. It appears from the report that the EU's commitment to Ukraine is weakening, and that the EU might be preparing to wrap up its Ukrainian adventure. This of course is what the results of Putin's talks with Merkel in February and with Kerry this month also suggest. However the report on Putin's website offers the first written confirmation of this from an official - albeit Russian - source. I discussed the Association Agreement in some detail in an article I wrote earlier this month for Russia Insider (see How the EU Association Agreement Makes Existing Ukraine-Russia Trade Links Impossible, Russia Insider, 4th May 2015). I explained in that article that contrary to what most people think, the Association Agreement is not simply a free trade agreement between Ukraine and the EU (even though it calls itself that) but that it is in reality a device to make Ukraine part of the European Economic Area and the European Single Market subject to the regulation of the EU bureaucracy in Brussels and the jurisdiction of the European Court of Justice in Luxembourg. I also explained in that article that these arrangements were completely incompatible with maintenance of Ukraine's existing economic and trade relations with Russia. Though I did not go into details of the geopolitical intentions behind the Association Agreement, its terms make them fairly obvious - to detach Ukraine from Russia, and to integrate Ukraine with the West. At the time I wrote that article it appeared that the tripartite negotiations between Russia, Ukraine and the EU were deadlocked and were going nowhere. The Ukrainians and the Europeans were categorically refusing any amendments to the text of the Association Agreement, while - for good reasons that I explained in the article - the Russians were insisting on nothing less. It now seems, if a report made to Putin at the government meeting on 20th May 2015 by Economics Minister Ulyukaev is to be believed, that a breakthrough has taken place, and that the Europeans have finally agreed to consider amendments to the text of Association Agreement, as the Russians have always demanded. Ulyukaev's words reporting the breakthrough to Putin were as follows: "Overall, more than half of the 15-month breather that we agreed on has passed now, and sadly, this time was not used very productively. But there was an expert meeting at the end of April, and the day before yesterday, I had a meeting with the EU Trade Commissioner and the Ukrainian Foreign Minister. ... "Overall, our approach met with our European and Ukrainian colleagues' understanding. We agreed that the experts will start working in groups to prepare by the end of July the documents, the status of which will be clarified later. "The documents could take the form of protocols to the Ukraine-EU agreement, or they could form a separate agreement that would make a single package with the [EU-Ukraine] agreement and would enter into force simultaneously with it. "Once this work is completed at the end of July, we will have to make an important decision, namely, whether this set of documents suits us, or whether we need to take other decisions." I should explain that Protocols are documents that are attached to a treaty or a legal document that become part of its text. They carry equal weight to the document to which they are attached. Good examples are the Minsk Protocol of 5th September 2014, which was technically speaking a document that was attached to the peace plan Ukraine's President Poroshenko had previously announced in June 2014, which it amended substantially, and the Secret Protocol of the Soviet German Non-Aggression Pact of 1939, which spelled out important details of the Non-Aggression that did not appear in its published text, and which I recently discussed in detail in another article. The alternative Ulyukaev talks about is equally radical - a separate treaty or agreement "that would make a single package with the [EU-Ukraine] agreement and would enter force simultaneously with it". In other words the Association Agreement would become one in a set of agreements, each of equal weight, with each agreement interpreted by reference to the terms of the other. Regardless of which option is adopted, Ulyukaev makes it clear that the intention is to give binding legal effect to changes to the text of the Association Agreement. On this Ulyukaev is unequivocal: "[E]ither we actually have been heard now and will obtain legally binding documents that satisfy us, or we will be obliged to act in accordance with Government Resolution No. 959 [the resolution of the Russian government that allows for cancellation of Russia's free trade agreement with Ukraine - AM]." As to the actual changes to the Association Agreement Russia proposes, Ulyukaev spelled them out: "The first concerns tariff regulation of goods of a sensitive nature for our economy. We propose setting transition periods before tariffs for these goods are liberalised in accordance with the Ukraine-EU agreement. "The second is customs administration and organising the relevant electronic documentation and information support, and identifying the goods' country of origin, so as to make proper use of the preferential regime and exclude from it goods that come from third countries. "There is also the matter of technical regulation. Here, we think it right to maintain the possibility for Ukrainian companies to choose between European standards and the standards in force under CIS agreements. Health and phytosanitary control is another matter here, too. "Yet another issue is Ukraine's inclusion in the electronic certification system in operation in the Eurasian Economic Union, so that we can be certain of the relevant information's authenticity. We want to keep in place the certification system currently in operation, so that businesses will not have to spend extra time and money on getting all their certification redone. "In the energy sector, we want to preserve the parallel operation of Russia's and Ukraine's unified energy systems, so as not to have to bring on line reserve generating and grid capability." These proposals, if adopted, would effectively nullify the Association Agreement as it exists now. Instead of a wholesale and binding adoption by Ukraine of the acquis, the body of EU law administered by the European Court of Justice, Ukrainian enterprises would be free to pick and choose whether to adopt EU standards (i.e., the acquis) or stick with Russian ones. Given that Russia is the biggest market for Ukrainian industrial goods, it is likely that the majority of Ukrainian industrial enterprises would choose to stick with Russian ones. Instead of the free movement of goods across the EU-Ukraine border envisaged by the Association Agreement - and which is a fundamental principle of the European Single Market - certain types of Ukrainian goods that Russia considers "strategically important" to itself would continue to be protected in the Ukrainian market from EU competition while continuing to have free access to the Russian market, as they do now. The existing electronic monitoring system would be preserved to enable Russia to track the movement of goods within Ukraine itself, so as to insulate itself from unwanted imports of goods from the EU. Ukraine's energy system would remain unified with Russia's. Though Ulyukaev does not spell it out, it appears likely this means some degree of Russian control of Ukraine's pipeline network, and of the electricity generating and supply industry. These proposals must be considered in conjunction with the equally far reaching political proposals for the extensive autonomy within Ukraine of the two People's Republics, which were recently published, and which I have recently discussed (see Ukraine: Confederal Solution Looms, Russia Insider, 14th May 2015). Taken together these two sets of proposals bring into clearer focus the sort of solution for the Ukrainian conflict that the Russians now envisage. This is for a loosely confederal Ukraine, in which the eastern regions largely govern themselves while exercising a degree of control over Ukraine's foreign and economic policies; which is barred forever from joining either NATO or the EU; and which remains tightly integrated economically with Russia; but with a certain scope for people and businesses in Ukraine's western regions to reorient themselves more closely to the EU. This is a totally different outcome than the one envisaged by the Maidan movement, which seeks a unitary, monocultural Ukraine inside NATO and the EU and distanced permanently from Russia. Since adoption of these Russian proposals would mark the final failure of the Maidan revolution, the Ukrainian government is certain to oppose them bitterly. The proposals might not however be so objectionable to some of the Maidan movement's supporters in western Ukraine. Recent reports (see Western Ukraine Ready for Secession?, Russia Insider, 28th April 2015) suggest growing secessionist sentiment there. If so, then it is not difficult to see how these proposals, if pitched properly, could appeal to the people of Ukraine's western regions, by offering them peace together with a certain connection to the EU, which is what they want. However the single most important fact to emerge from Ulyukaev's comments is that the Western powers are suddenly becoming receptive to these Russian proposals. Here again is what he said: "Mr President, you could say that a sense of cautious optimism has emerged. The ice is starting to melt, in the sense at least that they have started listening to us and are actually hearing what we say. "Overall, more than half of the 15-month breather that we agreed on has passed now, and sadly, this time was not used very productively. But there was an expert meeting at the end of April, and the day before yesterday, I had a meeting with the EU Trade Commissioner and the Ukrainian Foreign Minister. (Ulyukaev then sets out the Russian proposals) "Overall, our approach met with our European and Ukrainian colleagues' understanding. We agreed that the experts will start working in groups to prepare by the end of July the documents, the status of which will be clarified later." What Ulyukaev is saying is that after wasting eight months rejecting the Russian proposals out of hand, the Europeans have suddenly indicated in the last few weeks that they might be prepared to accept them after all. If this is really so, and if what Ulyukaev says is true, then it is the best evidence to date that the Western powers have indeed finally given up on their Ukrainian adventure, and have accepted that the grandiose geopolitical objectives they set themselves when they drafted the Association Agreement and backed the Maidan coup are unachievable, and that the time has now come to draw a line under the whole affair. |
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#16
New York Times
May 22, 2015
Disenchanted With Europe, Moldovans Shift Their Focus to Russia
By ANDREW HIGGINS
CHISINAU, Moldova - Daniela Morari, a Foreign Ministry official who has been traveling her country trying to nudge Moldovans toward the European Union, has heard it all. People are worried that "if you join the E.U., everyone becomes gay" and that Brussels bureaucrats "won't let you keep animals around your houses," an alarming prospect in a largely rural country.
It does not help that such views are encouraged on Russian television by growing pro-Russian political parties in Moldova and a deeply conservative Orthodox Church obedient to Moscow's ecclesiastical hierarchy. "We go to a place for an hour or so, and then we leave and they all go back to watching Russian television," Ms. Morari said.
Russian propaganda aside, however, Moldovans say they have more than enough reasons - not least widespread corruption here, the shadowy power of business moguls, and the war next door in Ukraine - to look askance at the European Union, which Ms. Morari fears is losing out to Russia in the struggle for hearts and minds in this former Soviet land.
Six years after the 28-nation bloc first targeted this country and five other former Soviet republics for an outreach program, that disenchantment, which is mutual, will be on display Thursday as European Union leaders join those from Armenia, Azerbaijan, Belarus, Georgia, Moldova and Ukraine for a two-day summit meeting in Riga, the capital of Latvia.
Instead of enjoying a new European dawn, the prospective partners are deeply mired in their own troubles. Or they are veering closer toward Moscow, swayed by a contrasting combination of a Brussels bureaucracy focused on technical minutiae and President Vladimir V. Putin's far more clear and assertive effort to return former Soviet satraps to Moscow's fold.
When European leaders last held their Eastern Partnership meeting in 2013, they were hoping to prod Ukraine's president at the time, Viktor F. Yanukovych, to sign a so-called Association Agreement. In coded bureaucratic language about "European aspirations," they stirred hopes that former Soviet lands might one day, at least in theory, be allowed to apply to join the European Union.
Alarmed by what he saw as a Western plot to encircle Russia, Mr. Putin began his effort to annex Ukraine's southern peninsula of Crimea, and subsequently backed rebel forces trying to tear eastern Ukraine away from Kiev. Chastened by the turmoil in Ukraine and the souring of relations with Russia, European leaders are now scaling back their eastward push.
Diplomats have spent months arguing over the text of a joint declaration to be issued at the Riga meeting, with some countries like Germany resistant to any wording that would raise unrealistic expectations in Moldova, Ukraine and elsewhere of admission to the European Union. A near final text circulating on Thursday acknowledges the "European aspirations and European choice of the partners concerned," but leaders still needed to sign off on that timid endorsement of a possible road toward Europe.
It is the kind of waffling that has left many former Soviet subjects less than enchanted by European entreaties. "Russia doesn't have to do anything," said Yan Feldman, a member of a Moldovan government council set up to combat discrimination. "It just has to wait. The idea of Europe has discredited itself."
Indeed, there is little to show from the six years of courtship of the former Soviet republics. Ukraine aside, Georgia is stuck in limbo amid fierce political infighting, and three other partnership countries - Armenia, Azerbaijan and Belarus - have rebuffed Brussels's inducements and moved closer to Moscow.
But nowhere is the gap between expectation and reality bigger than in Moldova, which last year secured visa-free travel to Europe for its citizens after being trumpeted by Brussels as the Eastern Partnership's "top reformer."
Today, Moldova's feuding pro-European politicians, like their counterparts in Ukraine, are so tainted by their failure to combat corruption and create a functioning state that, to many here, Russia looks appealing.
"They called us the best pupils in the class," said Iurie Leanca, a leading pro-European politician. "But we have lost the support of society."
Mr. Leanca would know. He was prime minister, until elections late last year that brought a surge in support for the anti-European Socialist Party, now the biggest single party in Parliament. Its campaign slogan: "Together With Russia!"
Pro-European forces still managed to form a coalition government, but only with support from the Communist Party.
While insisting that Russian propaganda had played a big role in shaping opinions, Mr. Leanca acknowledged that his government was also to blame. "They saw good will but did not see any results on corruption or poverty," he said of the voters.
A recent opinion poll carried out by the Institute for Public Policy, a Moldova research group, found that only 32 percent of those surveyed would support joining the European Union - an option that Brussels has no intention of offering - while 50 percent said they would prefer to join a customs union promoted by Mr. Putin. Over all, support for the European Union in Moldova has plummeted to 40 percent this year from 78 percent in 2007, according to the group's figures, which were based on what it called a representative sample of Moldovans.
Chiril Gaburici, a former telecommunications executive recently installed as Moldova's new prime minister after last November's inconclusive elections, said he was "not happy" about Europe's terminological retreat in the draft statement for the Riga summit meeting.
But, he added, Moldova's pro-European politicians have themselves dashed many hopes, noting that ordinary people are disappointed after years of hearing leaders "talking about reforms and a better life but not seeing that much real change."
A long series of scandals, including the theft of hundreds of millions of dollars from a leading bank, have provided powerful ammunition to pro-Russian forces.
One of those is Renato Usatii, a businessman turned populist political maverick who rails against corruption, spends much of his time in Moscow and drives a $350,000 Rolls-Royce. He was barred from competing in the November poll on what many viewed as a trumped-up pretext of registration irregularities.
"Even pro-European people who like the idea of Europe now hate the reality of what it has created," Mr. Usatii said. Europe, he added, "is losing Moldova."
A senior European diplomat, who asked not to be named so he could speak freely, complained that Moldova's pro-European politicians were "very good at singing the European song" to impress Brussels.
But in reality, he added, "they have really mucked up," discrediting both their own pro-European parties and the European Union. As a result, the diplomat added, many ordinary people now believe that "Russia cannot be any worse."
That is certainly the conclusion of Alexandres Botnari, the mayor of Hincesti, a small town in central Moldova that the European Union has promoted as an example of the benefits to be had from drawing closer to Europe. Those were supposed to include funding to guarantee that all Hincesti residents have clean water and modern sanitation.
Unfortunately, Mr. Botnari said, shaking his head at a slick brochure about Moldova's successes in partnership with Brussels, "reality is totally different."
Only a third of homes in Hincesti have sewage pipes, many do not have drinkable water, and nearly all the roads outside the center of town are still pitted dirt tracks.
The mayor, despite being a member of the nominally pro-European Democratic Party, said Moldova would be better off, at least economically, joining Mr. Putin's customs union.
While the European market is much bigger and richer than Russia's, Mr. Putin imposed tight trade restrictions in 2013 on Moldova in retaliation for its flirtation with the West. For now, exports to Europe have not yet risen enough to make up for what was lost in Russia.
"We cannot live without the Russian market," said Igor Dodon, the Socialist Party leader, as he sat in an office bedecked with photographs of himself meeting Mr. Putin in Moscow. Mr. Putin, he said, told him that Russia wants to revive trade and political ties with Moldova, but only if the country avoids moving toward NATO.
The European Union, Mr. Dodon said, "needed a success story and chose us. But now everyone sees this was all an illusion."
Nonetheless, when measured by the highly technocratic criteria Brussels uses to assess success, Moldova is still the Eastern Partnership's top reformer, having adopted 10,500 European standards for food, electrical goods and a vast range of other items.
But, conceded Ms. Morari, the Foreign Ministry official, success in changing sanitary norms and other arcane rules, while perhaps crucial to the creation of a modern country, "is difficult to communicate in a sexy way."
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#17
Club Orlov
http://cluborlov.blogspot.ru
May 19, 2015
No, you can't go back to the USSR!
By Dmitry Orlov
Russian-American engineer and writer
One of the fake stories kept alive by certain American politicians, with the help of western media, is that Vladimir Putin (who, they vacuously claim, is a dictator and a tyrant) wants to reconstitute the USSR, with the annexation of Crimea as the first step.
Instead of listening to their gossip, let's lay out the facts.
The USSR was officially dissolved on December 26, 1991 by declaration No.142-H of the Supreme Soviet. It acknowledged the independence of the 15 Soviet republics, and in the place of the USSR created a Commonwealth of Independent States, which hasn't amounted to much.
In the west, there was much rejoicing, and everyone assumed that in the east everyone was rejoicing as well. Well, that's a funny thing, actually, because a union-wide referendum held on March 17, 1991, produced a stunning result: with over 80% turnout, of the 185,647,355 people who voted 113,512,812 voted to preserve the USSR. That's 77.85%-not exactly a slim majority. Their wishes were disregarded.
Was this public sentiment temporary, borne of fear in the face of uncertainty? And if it were to persist, it would surely be a purely Russian thing, because the populations of all these other Independent States, having tasted freedom, would never consider rejoining Russia. Well, that's another funny thing: in September of 2011, fully two decades after the referendum, Ukrainian sociologists found out that 30% of the people there wished for a return to a Soviet-style planned economy (stunningly, 17% of these were young people with no experience of life in the USSR) and only 22% wished for some sort of European-style democracy. The wish for a return to Soviet-style central planning is telling: it shows just how miserable a failure the Ukraine's experiment with instituting a western-style market economy had become. But, again, their wishes were disregarded.
This would seem to indicate that Putin's presumptuously postulated project of reconstituting the USSR would have plenty of popular support, would it not? What he said on the subject, when asked directly (in December of 2010) is this: "He who doesn't regret the collapse of the USSR doesn't have a heart; he who wants to see it reborn doesn't have a brain." Last I checked, Putin does have a brain; ergo, no USSR 2.0 is forthcoming.
Interestingly, he went on to say a few more words on the subject. He said that the USSR had a competitive advantage as a unified market and a free trade zone. This one element of the USSR is now embodied in the Customs Union, of which Russia, Belarus, Kazakhstan and several smaller countries are members, and it appears to be a success.
The Ukraine-with over 40 million inhabitants, a major piece-refused to join while continuing to trade mostly with Customs Union members. This strategy has turned out to be, to put it mildly, disadvantageous, with Ukrainian economy now in rapid collapse, having declined over 17% in just the first quarter of this year. Thus, while the theory of competitive advantage may or may not be valid, the converse competitive disadvantage of *not* joining the Customs Union is there for all to see.
To be sure, many aspects of the old USSR have been happily consigned to oblivion. Among them:
* The communist ideology: the Communist Party no longer has a monopoly on power.
* The bloc mentality: the Warsaw Pact evaporated, leaving NATO behind as the one hand clapping. The new system is a multipolar one.
* Central planning: replaced with a market economy
* Economic isolationism: replaced with an export-driven economy based on trade agreements with numerous nations around the world
* Authoritarian governance: replaced with authoritative governance, in which leaders derive their authority from their popularity, which is based on their performance in office, whereas previously the General Secretary of the CPSU was a bit like the Pope-infallible by definition.
These are all positive changes, and very few people regret that they have occurred, or wish for a return to status quo ante.
There are many other aspects of the old USSR which have been degraded, sometimes severely, but nevertheless remain in place. Among them are public health and public education.
The USSR had a system of socialized medicine that excelled at some things and was mediocre in others. The shift to privatized medicine has been a success in some ways, but is very hard on those who cannot afford the care or the medications. The educational system is still very good at all levels, but here too there has been significant degradation, bemoaned by many observers.
The USSR invested heavily in science and culture, and much has been lost during the difficult years of the 1990s-something that many people regret very much. The USSR led the world in basic scientific research, probing into matters that did not have any commercial applications, simply because they were scientifically interesting and led to publishable results. The US led the world in product design, something that Soviet engineers were happy to simply copy much of the time, to save time and effort. Since they were not attempting to export into the western consumer market, a slight lag in time to market was of no consequence to them.
On the other hand, Americans have always had trouble wrapping their heads around the idea of financing scientific research that had absolutely no conceivable commercial applications. In addition, the anti-intellectualism prevalent in American culture caused a proliferation of other sorts of "scientists": political scientists, social scientists, food scientists... a certificate in "janitorial science" wouldn't be too much of a stretch.
Basic science is the premier transnational intellectual endeavor of the human species in modern times, and the damage done to Soviet science has caused significant damage to the pursuit of scientific knowledge throughout the world, and a diminution in the stature of the scientific endeavor. Now even in Russia scientists are forced to chase after grant money by pursuing avenues of research that lead to patentable gizmos and gadgets.
One of the things that has been retained is the living arrangement. Over the seven decades of the USSR's existence, there took place a thorough transformation from an agrarian population dispersed across the countryside to an industrialized population concentrated in major cities. The people went from being log cabin-dwellers to apartment-dwellers. Following the dissolution of the USSR, the housing stock was privatized, and now many families own their residences free and clear. The ability to live rent-free provides them with a very large competitive advantage compared to families in high-rent, debt-ridden countries such as the US.
Along with apartment buildings built in dense, walkable clusters went a system of public transportation. This, too, has remained largely intact, and in many cities has been expanded and modernized. This, again, provides numerous benefits to the population, and gives them an advantage vis à vis people in car-dependent countries, where the people spend much of their life stuck in traffic, and where the elderly, who are too old to drive safely, are often forced to choose between being stuck in their homes and taking their lives (and those of others) in their own hands behind the wheel.
When something is said to have collapsed, people often assume that it has simply ceased to exist. But the effects of collapse depend on the nature of the thing that collapses. When a hydroelectric dam collapses, it ceases to produce electricity, plus it destroys lots of things downstream from it, plus it may disrupt access to water. When a school collapses, it may kill some schoolchildren, and some teachers, but it doesn't necessarily destroy the knowledge that was being imparted. And when a mausoleum collapses, only its description changes: it can then be described as "ruined."
Some collapses are common, others not. Economies, especially bubble economies, collapse all the time. Empires collapse with great regularity. Civilizations are said to collapse, but do they really? A civilization can be viewed as a functioning apparatus, but doing so seems to confuse a set of principles with the entity that embodies them. Civilizational principles can be quite durable: the Roman empire was gone for a thousand years when Europe once again became capable of large-scale social organization, but, sure enough, the Europeans dusted off the old Roman legal codes and principles of organization, and started applying them. In the meantime, in the colleges and universities, Latin had remained the language of learned discourse, in absence of any surviving Latins being present to teach LSL classes. It would appear that civilizations don't really collapse; they just become quiescent. New developments may spark them back to life, or they may eventually be supplanted-by another civilization.
The USSR is gone as a political entity, but as a civilizational entity it appears to be holding its own, though it lacks a name. The two-part name-Soviet, plus "Soyuz" (Union)-fell apart. The word "Soviet," used as an adjective, applies only to the past. As a noun, it means "council," having originated from the revolutionary workers' councils, and this is still used, although cautiously: "to help with council" is, to a Russian, to only pretend to help. But the term "Soyuz" lives on; it is the name of the only spaceship that can still ferry passengers to the International Space Station; the new Customs Union is a Customs Soyuz. And Russian children still grow up in the Soyuz, in a manner of speaking, thanks to Soyuzmultfilm, the Soviet-era studio that produced excellent children's animated films, which are still hugely popular and are now available on Youtube.
Let us think of the Soyuz-as a civilization, rather than of the USSR-which was a political empire. A major effort was made to supplant it with western civilization, through the introduction of market economics and a flood of western imports, both material and cultural. Western civilizational principles dominated for a time, among them such western innovations as granting equal status to homosexual practices, disregarding the role of ethnicity in political organization, and the abnegation of economic and political sovereignty to the imperial center in Washington, DC. All of these were, for a time, masticated thoroughly. Then they were rather forcefully spat out, everywhere in the former USSR except for a few sorry basket cases, the Ukraine foremost among them. But everywhere else, once the full fiasco of western values became clear to all, previous civilizational principles came roaring back to life.
Perhaps foremost among them is social conservatism. The Russian Federation has two major religions: Orthodox Christianity and Islam, and a great deal of effort goes into maintaining their mutual compatibility, so that religion does not become a divisive factor. Introducing constructs that are alien to both, such as gay marriage, is a nonstarter. But polygamy is not off the table, and a senior Chechen official recently took a young bride to be his second wife. This event caused quite a sensation, but was allowed to proceed-in Moslem Chechnya.
Second is the principle that ethnicity is significant to social and political organization. Russia is not a nation-it is a multinational federation. There are over 190 different nations that make it up, with ethnic Russians accounting for a little over 3/4 of the population. This percentage is likely to decrease over time: Russia is second only to USA in the number of immigrants it absorbs, and their country of origin, sorted by the number of immigrants, is as follows: Ukraine, Uzbekistan, Tajikistan, Azerbaijan, Moldova, Kazakhstan, Kyrgyzstan, Armenia, Belarus, China, Germany and USA.
During the existence of the USSR, the multi-ethnic composition of the country was given much emphasis. Numerous small nations had their languages written down for the first time, using the ever-expanding Cyrillic alphabet, and endowed with a national literature. National languages were included in school curricula, and various nations used them in their local self-governance, to enlarge their autonomy and improve social cohesion. In essence, the Russian Federation provides for ethnic sovereignty-each nation can claim a measure of sovereignty for itself, rule itself and create its own laws, provided they do not conflict with the larger whole. A prime example of this is modern Chechnya: Moscow is content to let it prosecute its own anti-terrorist campaign, to put down the remaining foreign-financed jihadis.
Imagine the principle of ethnic sovereignty being applied to the US, where one's ethnicity is of no consequence provided one looks, sounds and behaves sufficiently Anglo. In the US, ethnicity has been reduced to questions of music and cuisine, with perhaps a festival here and there, but always with the tacit understanding that "ethnic" means "other": there is no such thing as an "ethnic Anglo." Since ethnicity is essentially taboo, the completely artificial construct of race is used instead, with artificial, discriminatory labels attached to categories of individuals. The label "Latino" is particularly bogus, since there is very little in common between, say, a Cuban and a Bolivian, except that both are likely to face discrimination, neither being considered sufficiently "white"-Anglo, that is. But imagine if the Mexicans or the African-Americans were to be granted a similar level of autonomy within the US? It would blow the country to pieces!
A country predicated on protecting "white privilege" cannot possibly survive such a corruption of its founding principles. The US fought a revolution to keep slavery legal (it was about to be abolished by the British); then it fought a civil war to change slavery from one form to another (there are more African-Americans in US jails now than there were slaves in the Confederate South prior to the Civil War).
Nobody knows what wars lie in its future, or what will provoke them, but this particular intercivilizational fault line is likely to be very important. For what is a nation? Is it your tribe, or is it a bunch of mercenaries pretending to be Anglo so that they are allowed into the country club? Only time will tell which of the two civilizations will prove to be more durable.
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#19 The Daily Telegraph (UK) May 22, 2015 Eurovision 2015 favourite: Russia Russian beauty Polina Gagarina is one of the top-tips to win the Eurovision Song Contest 2015. Charlotte Runcie explains why [Music video here http://www.telegraph.co.uk/culture/tvandradio/eurovision/11620639/Eurovision-2015-favourite-Russia.html] Who is she? Polina Gagarina, no relation to American singer Lady Gaga, hails from Moscow, had a pan-European upbringing in Greece. She's only 28, but has been in the industry for a while: Gagarina won Star Factory, a Russian reality singing contest, in 2003, and has landed a number of Ukrainian and Russian top 10 hits after releasing her own album and collaborating with producer Konstantin Meladze in recent years. What is she singing? A Million Voices. Synth-heavy with oodles of key changes, on record it sounds quite a lot like a standard karaoke ballad - think Take That-lite. Why is she a favourite? Russia's song this year is an example of an entry that didn't really stand out before the live performances began, but has live potential. As soon as their singer, the drop-dead gorgeous Polina Gagarina, took to the stage in her huge, glowing white dress and nailed the high notes in a soaring, stadium-filling semi-final performance, bookies reported a surge of bets that she'd win the whole thing outright. What are the odds on her winning? 15/4. It's an epic act and she could just steal the rug from under the feet of the previous favourites. Good grief. Despite Russia often losing out in the votes in recent years because of various human rights concerns, are we heading to Sochi next year? When can I watch her? On Saturday night, 23 May, during the Eurovision Song Contest in Vienna, which will be broadcast from 8pm on BBC One. |
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#20
Valdai Discussion Club
http://valdaiclub.com
May 21, 2015
Donetsk People's Republic: Independence or Autonomy as a Part of Ukraine?
By Yevgeny Kopatko
Yevgeny Kopatko is sociologist and Research&Branding Group cofounder.
On the first anniversary of the referendum on independence of the Donetsk People's Republic, its officials claimed that they were not demanding independence, they were fine with becoming an autonomy as a part of Ukraine. Such statements are directly related to the Minsk process, they are akin to a compromise, although it is hard to predict how the events would develop in reality. Political declarations and real actions today differ greatly. The process of de-escalation is, in fact, on a political level at the moment, it is not happening in the information space and in the military sector. Heavy artillery was indeed withdrawn from the confrontation zone, the amount and the concentration of the armed forces on both sides have not been verified, the Ukrainian forces are beefing up, mobilization in the Donetsk People's Republic and the Luhansk People's Republic continues. Statements have been appearing in Ukraine that some autonomy is possible, certain cooperation may be developed. What would leaders of the DPR and the LPR insist on? Status of the Russian language, neutral status of Ukraine, high-scale autonomy - it is the most vague notion voiced by politicians on both sides.
So far, we can say one thing for sure: the key statements are stovepiping of new opportunities into information space. In general, the risk of further escalation of the armed conflict has not left the agenda.
Furthermore, let's bear in mind that the condition of the Ukrainian economy may have additional great impact on the confrontation. We understand that military actions are a serious blow for the economy of Ukraine and for the economy of the territories under control of the DPR and the LPR. The Donetsk region was accruing about 12% of the country's GDP, the Luhansk region - 5%. A significant economic potential is concentrated on both territories: dozens of mines, metalworks, chemical and engineering enterprises. In this area there is a large percentage of skilled and highly professional personnel, despite the fact that a large part of people (up to a million, according to different data) have left the Donetsk and the Luhansk regions. It is important to note that the conflict affects the territory of one of the biggest countries of Europe with a population of over 40 million people.
The problem of creating autonomous formations and their functioning can generally be solved under certain conditions. But it depends on who will manage the economic process.
Forecasts of economists saying that the GDP of Ukraine will drop by 7.5% this year are groundlessly optimistic. I suppose that those are exceptionally understated figures because the situation is much more dramatic.
Ukraine suffered a break of ties which can lead to tragic consequences, doubtlessly affecting the Donetsk region and other territories of the country. There is another condition that will take effect all over Ukraine (in other words, the territories under the control of the DPR and the LPR and the territories under the control of Ukrainian authorities). That is drastic deindustrialization of the country. It means that industry is falling, enterprises are closing down, huge numbers of people are leaving the country, losing their jobs. It is a very alarming signal because the country stops making money. Without foreign loans, the country is foredoomed. What and how can anything be produced in Donbas? It is a question for serious economists. We need to consider the economic potential of Donbas and the intensity of its ties with other regions of Ukraine.
To what extent can industries exist autonomously, and what human resource would be employed to keep them running? By answering these questions, we would probably forecast the situation in terms of survivability of the territories of the Donetsk People's Republic and the Luhansk People's Republic.
All the talks about the ability of Donbas to survive become pointless when a new flashpoint appears or the conflict escalates again. The issue of economic recovery in this case is deferred indefinitely.
To keep the structures of governance and local self-governance functioning, the DPR and the LPR have a skilled reserve of personnel which is well-acquainted with the peculiarities of their territories. Restoration of industry and infrastructure will enable many people to return to the territory of the Donetsk and the Luhansk regions and to join the governance process.
Donbas has enormous prospects and opportunities. Most importantly, I repeat, it is the industrial potential, extreme human resource that went through very complicated conditions. People didn't leave their homes en masse, as seen in the results of surveys conducted on the territories of the DPR: most people are reluctant to leave their territories. Local patriotism may become the mechanism, or to be more precisely, the incentive, that would enable stabilization of the situation. Patriotism alone is not a solution. Indisputably, functionaries need to understand the peculiarities of industries that can operate independently or relatively-independently.
The territories of the DPR and the LPR certainly need an international humanitarian mission. The devastated infrastructure, the huge number of people without jobs, housing, basic livelihood - all this reflects the fact that survival without humanitarian aid is very tough. It is vital. Time has come to begin recovering industries, so that people could pull through and make money. Without a peaceful scenario, they will fall into a great need for restoration of industry and opening of workplaces essential for improving the standards of living.
Regarding the diplomatic settlement of the situation, the Minsk Agreements are undoubted. Angela Merkel, American politicians and Russian leaders have common grounds here. Compliance with the Minsk process will guarantee diplomatic settlement of the situation.
The participants of the dialogue process could without bias assess the situation in Ukraine and give us a real picture of the economic and the humanitarian situation in the DPR and in the LPR.
On the other hand, there are very many declarative statements. The risk of conflict's escalation still remains. I suppose that the regime would not allow Donbas to go its own way. Because in this case the concept of Ukrainian authorities for Donbas would be shattered.
Ukrainian authorities blame Russia for the developments in Donbas and Ukraine. On the other hand, the serious mistakes made by the Ukrainian political authorities in the last one and a half years are discarded. Especially after the forceful unseating of the former lawfully elected government in Kiev.
In my opinion, the mistake of Ukrainian authorities is the absolute refusal to recognize the referendum of May 11. The number of people casting votes in the referendum is much greater than the number of people going to the polls at the presidential elections in late May 2014. Ignoring this fact has become one of the main reasons for the negative development of the situation in Ukraine as a whole and in Donbas in particular.
The opposing forces need to realize that only negotiations, diplomatic efforts, good will, not weapons, can help them reach a logical political compromise.
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