#2
Bloomberg
July 29, 2015
No Quick Fix for Ukraine With Limp Revival Next After Recession
by Agnes Lovasz

Ukrainians hoping the trough in their 1 1/2-year economic slump will usher in a rousing recovery are likely to be disappointed.

The foreign demand that powered growth after the last recession in 2009 is largely absent. At home, a war with pro-Russian separatists has decimated industry, ravaged government finances and sunk the hryvnia. While the contraction may have bottomed mid-year, expansion probably won't top 2.5 percent before 2019, according to Goldman Sachs Group Inc.

"Domestic financing constraints and post-conflict economic effects are likely to constrain the country's medium-term growth outlook," Andrew Matheny, a Moscow-based economist at Goldman, said this month in a note.

Statistics office data due Thursday or Friday will show gross domestic product plunged 16.7 percent from a year earlier in the second quarter, according to a Bloomberg survey. On a quarterly basis, Kiev-based investment bank Dragon Capital agrees that the economy may have bottomed out during that period, though the government only releases annual figures.

Like Goldman, Dragon sees a "muted" recovery. And there are plenty of limits on investment from within Ukraine: fiscal tightening under a $17.5 billion International Monetary Fund rescue, destruction of factories in the conflict zone and a loss of exports to Russia.

"With the global economy growing only moderately now, Ukraine's near-term recovery prospects hinge on the rather scarce domestic resources," Dragon's chief economist, Olena Bilan, said last week in an e-mailed note.

Can the government juice up the revival? Only if it speeds efforts to revamp Soviet-era bureaucracy, stamp out graft and improve the business climate, according to Goldman's Matheny. As long as those overhauls drag, foreign investment that would help stoke economic expansion will remain "anemic," he said.

"Ukraine needs much deeper, swifter and more radical reforms in order to attract the foreign investment needed to raise the country's growth rate," Matheny said.

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 #3
Business New Europe
www.bne.eu
July 30, 2015
KYIV BLOG: Ukraine elites face reshuffle as Tymoshenko regains popularity
Sergei Kuznetsov in Kyiv

When Batkivshchyna (Fatherland), the party headed by former prime minister Yulia Tymoshenko, barely scraped over the 5% barrier required to secure representation in Ukraine's parliament during snap elections in late October, many experts declared that Tymoshenko's political shelf-life had expired. Society wanted to see new leaders in post-Euromaidan Ukraine, they argued. However, nine months later and Tymoshenko is staging a comeback as one of the country's main political leaders, which could lead to new wave of infighting in Kyiv and a major reshuffle of the political elites.

"[There is] only chaos, irresponsibility and corruption today," Tymoshenko said emotionally, describing the situation in Ukraine in an interview with Inter TV in mid-July. This quote is characteristic of the tactics that Tymoshenko, who played a leading role in the 2004 Orange revolution, has employed over the past few months.

As a member of Ukraine's ruling coalition, Tymoshenko and other members of her party have used every opportunity to denounce unpopular measures implemented by the government - measures that are necessary for reforming the economy and obtaining donor support. Criticism of the recent sharp rise in utility tariffs, which is a condition for the receipt of a support package from the International Monetary Fund (IMF), has been front-and-centre of Tymoshenko's rhetoric for many months. In May, Tymoshenko described the government's refusal to index pensions and salaries as "financial genocide".

Oleksiy Haran, a professor of comparative politics at the Kyiv-Mohyla Academy, in an interview with bne IntelliNews has described Batkivshchyna as a part of an "interim opposition" that exists within the ruling coalition. And this role is being fruitful for Tymoshenko, who spent more than two years in prison during the rule of ousted president Viktor Yanukovych for what many considered trumped-up charges of abuse of office, and was freed on the same day that Yanukovych fled the country in February 2014.

According to a recent poll by the Kyiv International Institute of Sociology (KIIS), in a hypothetical presidential election held in July with expected turnout at 54%, support for Poroshenko has fallen to a record low of 26.9% since his 54.7% first-round election win in May 2014. Tymoshenko is already hot on his heels with 25.6%. Other Ukrainian politicians are far behind Tymoshenko and Poroshenko.

Collapse of Yatsenyuk's rating

KIIS also held a poll for hypothetical parliamentary elections. With an expected turnout of 56%, Batkivshchyna would obtain 22.7%, slightly behind Poroshenko's Bloc with 23.5%. Significantly, the People's Front, headed by Prime Minister Arseniy Yatsenyuk, who led Batkivshchyna during Tymoshenko's imprisonment, could count on just 2.8% of the vote. This represents a crushing fall for the party that won last October's parliamentary elections.

"Yatsenyuk`s performance as Ukraine's prime minister has been weak, especially when it comes to reforms (he is mostly blocking them). Endless rumours that he is taking over, or at least resisting initiatives to clean up previous corruption schemes, have hurt his and his party's rating," Balazs Jarabik, visiting scholar at the Carnegie Endowment for International Peace, tells bne IntelliNews.

The expert believes that the legacy of Euromaidan - the street protests that ousted Yanukovych and his corrupt regime - has mainly been taken up by Poroshenko and Samopomich, a party which positions itself as a younger generation in Ukrainian politics. "In many people' eyes, the People's Front has become a party of hawks. It has less and less support in society," Jarabik says.

In such a situation, it would be strange if Tymoshenko refused to lobby for new parliamentary elections, which theoretically could give Batkivshchyna significant control over the government. And it appears that the charismatic Tymoshenko has already started to campaign for fresh polls. "This parliament has no right to exist, because it does not serve the people, it does not feel responsibility [for the country]," she said in an interview with Inter TV in July.

Local elections

Tymoshenko will have her first battle with the post-Euromaidan elites on October 25 in local elections. And it looks as though she is ready to taste victory. In her interview with Inter TV, she called the upcoming local elections "a unique chance to change the country", adding that a change of local authorities will provide an opportunity to prevent the government from enacting its current policies. "Today, all the issues that hurt the people are generated in the government."

Poroshenko announced in late May that the elections would take place "despite numerous appeals to cancel [them]".  There has been a lot of media speculation in Ukraine that some of Poroshenko's advisors and members of his party had insisted that the campaign should be cancelled due the decline in the popularity ratings of Poroshenko and Yatsenyuk.

Success for Batkivshchyna during the local elections would be especially valuable to Tymoshenko because Poroshenko has started a process of devolution in Ukraine, which envisages, in particular, additional financing for local authorities. "We believe that the best pattern for Ukraine in implementing a real decentralisation is just to use Poland's model. We are similar [countries], and if we adopt Poland's model in Ukraine, this will definitely work," Yatsenyuk said in late April.

Jarabik says that Tymoshenko has learned "to be silent and patient": she is willing to act as an ordinary member of parliament whilst also employing radical populist rhetoric. This puts her closer to the Radical Party of Oleh Lyashko than to the "mainstream" parties of Poroshenko and Yatsenyuk. "Tymoshenko is riding the waves of dissatisfaction with the post-Maidan government," he underlines.

Meanwhile, one of the main questions now is whether Tymoshenko's return to the main political stage means that bitter infighting between different parts of the democratic camp in Kyiv is now inevitable. After the Orange Revolution, pro-Western president Viktor Yushchenko found himself locked into a long drawn-out battle with Tymoshenko.

Yushchenko is now warning about a possible repeat of this situation as a result of Tymoshenko's desire to gain more power in Ukraine. "Putin has no greater political destabilising factor in Ukraine than Tymoshenko. When Poroshenko stumbles on the threshold first time, you will see her mission... When the public authorities shout, 'we are for peace', she will provoke a war. When the public authorities offer a war, she will offer peace," Yushchenko said in a December interview with the Ukrainian website Ukrainska Pravda.

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 #4
Political parties for sale in run-up to Ukraine's elections

KIEV, July 30. /TASS/. In the run-up to local elections due on October 25, Ukraine has seen an upsurge in the market of political parties offered for sale, with prices starting from $25,000 apiece. Over the past six months, a total of 27 political parties have been registered in Ukraine, some bearing rather exotic names such as Glory to Ukraine or The Good Samaritan.

Contact information is readily available at Internet forums, says the daily Vesti. The party's registration date does not matter, so low-profile projects may also sell well.

"Even an embryonic party with no local chapters will do. The sole mandatory requirement is that it should be eventually registered in the customer's own region," lawyers explain.

"We have several parties on offer. Some are newly-founded, no more than six months old. Others have been in politics for two, three or five years, the list is rather long," says mediator Dmitry, adding that prices start at $25,000. Another vendor, Andrei, offers the political party calling itself Independent Political Platform for "a tiny $40,000".

"Money down, and we will arrange for a convention and have the leader and board members re-elected," he promised.

The market of political parties went agile shortly after Ukraine's parliament adopted a law on local elections. Political technologist Andrey Zolotaryov said the parties may come in handy for those who put a stake on local projects.

"That is the surest way of getting into the legal space the new election law requires," he added.

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 #5
www.foreignpolicy.com
July 29, 2015
Vote-Buying Cheapens Ukraine's New Democracy
BY IEVGEN VOROBIOV
Ievgen Vorobiov is a trade policy analyst based in Ukraine. His research deals with EU-Ukraine relations and the Ukraine-Russia conflict.
 
It has not been lost on Ukrainian politicians that many of their voters are poor. Those running for office have often tried to profit from this sad fact. But their frantic attempts to buy votes are increasingly alienating and discouraging the electorate.

I've just returned from the city of Chernihiv in northern Ukraine, where I observed a parliamentary by-election this weekend. On a scorching hot Sunday morning, citizens of this placid provincial town trickled into a polling station located in a big high school gymnasium. There was a strong smell of fresh paint. Despite the usual summer lull, this electoral district in Chernihiv has made headlines in the Ukrainian press. Commentators have described the race for this seat the dirtiest election campaign in recent memory. Even President Poroshenko called the pre-election maneuvering a "disgrace."

In the end, over 90 candidates joined the fray - so many that the electoral authorities had to create a yard-long paper ballot to fit them all in. Unfortunately, the proliferation of candidates didn't make for healthy political competition, since most of those entering the race had zero political weight and served only as spoilers for the main contenders.

The real battle played out between Sergiy Berezenko, a nominee from the party of President Petro Poroshenko, and Gennadiy Korban, a business partner of powerful oligarch Igor Kolomoisky. The president and Kolomoisky have been involved in a high-stakes power struggle since March, and almost everybody I spoke to agrees that the Chernihiv election was a proxy battle between the two men.

Chernihiv's citizens have become the main casualties of the stand-off. Neither Berezenko nor Korban is native to the city, leading locals to refer to them disparagingly as political "parachutists" (the Ukrainian equivalent of "carpetbaggers"). Berezenko embodies the cronyism of Poroshenko's entourage, given the president's propensity to appoint close associates and former business partners to official posts. The nephew of a high-ranking lawmaker in the president's parliamentary faction, Berezenko chairs a notoriously corrupt government agency in charge of managing government property. On the other side, Korban has also never been a public politician before this campaign. His main claim to fame stems from helping Kolomoisky solve corporate disputes before the Maidan revolution and manage the Dnipropetrovsk regional administration afterwards.

According to the official results, Poroshenko's man won. (The outcome was verified by Ukraine's most reliable election monitor, the civic organization OPORA.) Precisely how this victory was achieved, however, is quite another matter. The 36 percent of the vote that Berezenko ultimately won probably has less to do with his own lackluster campaign than with his closeness to Poroshenko, who remains relatively popular. Even so, Berezenko's team has earned biting criticism amid allegations that it paid for votes before the polling day. Similarly, Korban's team (which finished second with 15 percent of the vote) is said to have bribed the poorest voters with food packages disbursed on city streets. According to the estimates of another Ukrainian election watchdog, about 40 thousand potential voters received these handouts (nearly every third).

The by-election in Chernihiv has thus revealed an uncomfortable truth about Ukrainian democracy: most politicians are happy to exploit the voters' poverty. In Chernihiv, one of the poorest areas in Ukraine, the annual per capita income in the region is only 86 percent of the national average. The contrast with the relative affluence of Kiev, a mere 85 miles away, is stark. Instead of engaging in debate about policies for fighting poverty, the candidates simply opened their respective party coffers.That the opposing political camps resorted to such crude tactics - despite the intense public attention surrounding the election - attests to the elite's depressing shamelessness even by the lax standards of Ukrainian political culture.

This economic insecurity creates serious incentives for political corruption on the voter's end as well. Yevgen Radchenko, an election campaign expert from the civic organization Internews Ukraine, explained the problem at a recent training session for election observers. When polled off the record, he says, most of the poorest voters agree to sell their votes when the interviewer offers a sum equivalent to monthly expenses on house utilities (some $20 compared to an average Ukrainian salary of less than $200). This means that, in an electoral district with 145 thousand registered voters (like the one in Chernihiv), a cynical candidate would have to spend less than $1.5 million in order to pay this amount to the poorest 50 percent of all registered voters. Not all are guaranteed to give their votes in return - but many do.

The opacity of campaign financing, a perpetual problem in Ukraine, intensifies this degradation of electoral competition, especially on the local level. Candidates resort to loopholes in the legislation to mask their handouts as "charity donations." Berezenko's campaign was reported to have signed so-called "social contracts" (money in exchange for campaign promotion services) with prospective voters as a shield for shady cash transfers. Korban's team got around the restrictions by handing out food packages in areas that technically lay outside the city's electoral district. A third candidate from the Democratic Alliance party challenged these violations in a Chernihiv court one week before the election. However, the courts swiftly rejected the case on the basis that there was "no proof" that these practices constituted vote-buying. The court thus effectively gave the two main rivals a green light to carry on with the practice of "remunerating" voters materially

Despite the use of dirty campaign money to lure voters, the turnout of only 35 percent was still low in comparison to all previous parliamentary elections. This means that Berezenko earned his parliamentary seat thanks to a meager 12 percent of eligible voters - hardly a strong sign of democratic legitimacy. Public disenchantment with the corrupt campaign has had a more serious impact than Ukrainian politicians admit. Several voters who came to the polling station where I observed the vote complained vocally that they saw no candidates on the list who reflected their interests. The turnout of young people was astonishingly low, despite the intensive coverage of the campaign on TV and social networks. The political apathy of this otherwise active social group has been a worrisome hallmark of this election.

It all boiled down to this: two moneyed competitors from Kiev and Dnipropetrovsk saw fit to arrange an auction for a parliamentary seat in a district where no one among the local politicians has comparable resources. Since the candidates had no real connection to the city, they chose to buy voters rather than communicate with them. The disenchanted voters responded by not showing up. Unless this problem can be addressed, Ukraine's next elections, scheduled for this October, are likely to turn into a vulgar competition among the richest to buy the votes of the most deprived.

 #6
Counterpunch.org
July 29, 2015
The 'Ichkerization' Crime Wave in Ukraine
By DMITRY RODIONOV
[Bio here http://svpressa.ru/authors/39/]

'Soon, citizens will agree to any power that will deliver them from the bandits.'

A girl was abducted last month by an unknown person on Independence [Maidan] Square in Kyiv on a Sunday evening. This was reported on the traffic police website: "Kiev. Girl kidnapped, Independence Square. A girl was forced into a car, which fled in the direction of a pedestrian zone. 06/14/2015, 21:40. BMW 5 Series, AK6068CI, dark color. Information of the Kiev State Automobile Inspectorate."

On the same date, a 16-year-old girl was kidnapped in the Ivano-Frankivsk Region, as reported by the press service of the regional administration of the Interior Ministry: "On June 14, around 1:30 am on the road between the villages of Rosokhach and Vinograd in Gorodenkovskii district, an unknown person forced a girl into a VAZ (Lada) car and drove off in an unknown direction. Her current whereabouts are unknown."

Earlier, in the Donetsk Region, in Slavyansk, occupied by Ukrainian troops, a local resident told the police that her son had been abducted. This was the report by a law enforcement source: "The woman went to the Slavyansk police on June 10 and stated that a group of people had grabbed her 20 year old son in the street. According to the woman, her son was taken to an unknown destination. "

On June 12 (line 102 of the police report), an operations duty officer was informed that near the Troeschina Market in Kiev, an unknown person held a man in a car, demanding money. When law officers arrived on the scene, they saw a young man lying on the ground with no signs of life. Doctors pronounced him dead.

On June 1, eight year old Nastya Bobkova was abducted in her yard in Zaporozhye. On June 13, she was found dead on the island of Khortytsya in a forest plantation, near a training base belonging to Ukrainian neo-Nazis.

In social networks were reports of a search for missing student Jana Dmitrikova of the Zaporozhye Aviation College. The girl was returning home from work late at night on June 13 but never made it home.

Sixteen year old Susanna Sharkova, who had been missing, was found murdered in a private home in the Shevchenko district of Zaporozhye on March 11.

June 8, an unknown person driving a black Mercedes kidnapped a girl in Kostelni Street in Kiev. This was reported by the Ukrainian Ministry of the Interior.

On May 19, according to the aforementioned site, a girl was kidnapped in the Obolonskiy District of Kiev by an unknown person driving a Mercedes.

All of these messages resemble reports from the front lines of war. Serious crimes occur almost every day in Ukraine, most of which remain unsolved. Kidnappings in broad daylight, vehicle hijackings, robberies--all of this has become commonplace in the country that won the "revolution of dignity" on Maidan Square.

In 2014, Ukraine registered more than one million criminal offenses, a nearly 90% increase in the number of serious crimes-most of them in the capital city of Kyiv.

The number of robberies since the beginning of this year is twice that of the same period of 2014. Almost all involved weapons. In the view of the president of the Ukrainian Federation of Security Professionals, Sergei Shabovta, the cause of this sharp increase in the number of armed assaults is a drastic rise in social tension and a large number of illegal firearms.

"In the first quarter of this year alone," said Shabovta, "the number of crimes of violence involving the use of weapons has more than tripled. This statistic is, unfortunately, sometimes hidden from the public by the law enforcement system."

The expert explained that in Ukraine, there has been an increase in the number of people suffering depression. Many of those have been left homeless and destitute. In addition, Shabovta noted a significant increase in illegal arms trafficking. There is information that Kiev is experiencing sharp increases in trafficked weapons from the so-called ATO zone (referring to the 'Anti Terrorist Operation' of the Ukraine government against Russian-language fighters in eastern Ukraine).

As reported by 'Aydar' battalion Chief of Staff Valentin Likholit to the correspondent of the Ukrainian edition of Vesti, weapons from the war zone are entering Kyiv both for sale and as backups for emergencies. "It works like this: thugs associate themselves with brokers, who then organize the delivery," he said.

Most buyers want to buy Makarov (PM) and Tokarev (TT) combat pistols and cartridges, and grenades. Sellers offer "to obtain any weapons", showing the items in photos. In today's Ukraine, guns are easy to order for home delivery, even via social networks.

Incidentally, many mass media outlets already compare Ukraine with Dudayev's Chechnya. We all know what happened to the nearly-forgotten 'Ichkeria'.[1]

Most of the population became tired of thuggish lawlessness and supported an anti-terrorist operation by Russian troops and a return to the legal domain of the Republic of Russia.

According to analyst Vasily Muravitskiy, the main reason behind the worsening of the criminal situation in Ukraine is the destruction of the continuity of power. "The situation is such that the power in the country is lying in the dust. In the minds of thousands of people, there is the impression that they can just pick it up and use it. The government has given up the most important responsibility of power: it has ceded the right to use force to self-organized, semi-bandit battalions, some of which, like 'Azov' and 'Aydar', are recognized even abroad as fascist bandits.

"The state is unable to stop this because what remains of the state apparatus is directly involved in the mayhem. Take, for example, the appearance of a right-radical extremist organization at the building of the press-secretary of the Prosecutor General of Ukraine. He had come to support the chief of the SBU, Valentin Nalyvaychenko, who was summoned for questioning.

"Consider the pictures of burning oil depots, where lunches for the fire brigades were brought by volunteers instead of the state.

"The 'Maidan' government has launched a mechanism for the collapse of the state at the highest government level. Therefore, the 'Ichkerization' of Ukraine will continue. But the main problem is not even Ichkerization but, rather, the fact that in Ukraine today, there is not a single real force that could, or would want to, oppose the banditization of the country and its transformation into a free-for-all."

Political analyst Victor Shapinov also believes that Ichkerization of Ukraine has already taken place. "Speaking of the lawlessness of armed men, a substitute for the state, it has already happened. And it all started right on the 'Maidan', where the nationalists seized the House of Trade Unions and the Ukrainian House [convention center] and the first thing they did was to create makeshift prisons and torture chambers.

"Even the 'post-Maidan' rule, which relies heavily on the terror of paramilitary groups, had to struggle with extreme manifestations of Ichkerization. Let us recall the elimination of one of the extremist leaders, Muzychko.[2] The process goes on.

"A recent example was the robbing of a gas station by ATO veterans who killed two police officers as they attempted to arrest them.[3] This is a case where employees of law enforcement agencies at least tried to stop the lawlessness of the "national heroes". But how many cases might there be when the police were afraid to intervene?"

Svobodnaya Pressa (SP): Can we say that the state is neglecting its responsibility to protect civilians?

"This state did not declare this goal. It is not responsible to the citizens. But it is always ready to answer to their sponsors in the West. Some people have openly said: 'If you are dissatisfied with something, you are agents of a foreign enemy.' I'm not exaggerating. See statements by officials in Kiev. Look at the central television channels to see for yourself."

SP: Will we come to the point that the majority of Ukrainians, like most residents of Chechnya at the beginning of the 2000s, will welcome troops who can put an end to the lawlessness?

"I think the picture is more complex than that. But before the militia of Donbass is greeted with flowers in the cities of central Ukraine, the Lugansk People's Republic (LPR) and the Donetsk People's Republic (DPR) must set an example by successfully building up a welfare state against the backdrop of a Ukraine plunging into the abyss. Of course, some progress has been made in this respect. For example, the nationalization of a number of important enterprises in the breakaway republics.

"But for now, there is still a question whether state-building will continue in Donbas. After all, there are the Minsk agreements stipulating that the LPR and DPR must return to Ukrainian jurisdiction. Meanwhile, to restore order in the country, there must be a clear-cut alternative to official Kiev. And not only a military alternative but also a political and ideological one."

Ukrainian historian Vladimir Kornilov, director of the Center for Eurasian Studies, recalls that most armed crimes committed in Ukraine are now perpetrated by punitive forces that have been at the front. "As a result of the massacre unleashed a year ago by Kiev, arms are spreading around the country uncontrolled. Gangs formed under the guise of "volunteer battalions" (note, even the Prosecutor General of Ukraine has recognized that 'Aydar' is a gang) are now completely unchecked. And it would have been strange if all this had not led to a sharp increase in crime. The exponential growth in crime was birthed by 'Maidan' itself."

SP: Why can't the authorities do anything?

"What can we expect from the authorities, born with the aid of gangster methods? This government understands that without war, it would be swept away. All its efforts are aimed solely at trying to contain its gangs in Donbas, where criminals with weapons in their hands can do all sorts of crimes, while not allowing them to rampage too much in the rest of Ukraine.

"But even Kiev understands that these efforts are fruitless. Looters returning from the front cannot live and earn by any other means. The Kiev government consists of minions who live by the principle of the French proverb: 'After us - the deluge'."

SP: What is the likelihood of obtaining the consent of citizens for whatever power that can deliver them from the mayhem?

"The kind of chaos and lawlessness that now reigns in Ukraine always generates a desire among citizens for a 'strong hand' [to control it]. The political slant of this 'hand' usually does not worry the populace very much..."

This piece was originally published published in Svobonaya Pressa [Free Press], July 23, 2015. http://svpressa.ru/politic/article/125150/

Translator's notes:

[1] Dzhokhar Musayevich Dudayev was the first president of the 'Chechen Republic of Ichkeria' from 1991 until his death in 1996. He was killed by Russian armed forces.
[2] Aleksandr Muzychko was shot and killed by Ukrainian police in March 2014.
[3] Two police officers were killed and three others were hospitalized by automatic gunfire in the early hours of Sunday, May 3 as they gave chase to two gunmen who had robbed a gas station. The gunmen and their accomplices were members of several neo-Nazi battalions, including 'Aidar' and 'Azov'. Among the accomplices later arrested was 19 year old Vera Zaverukha.

Translation to English by Don Hank for CounterPunch.

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#7
www.rt.com
July 29, 2015
Power thinking: Autonomy-seeking ethnic group, Right Sector movement in Ukraine conjured up by RT?

RT Editorial: This blog represents a range of opinions prepared by a team of authors working at RT. It contains commentary, views, feedback and responses to various events and news media items.

"Russian propaganda" and the "imagination of RT producers" have become so powerful they have created an ethnic group seeking autonomy in western Ukraine, according to US Ambassador in Kiev, Geoffrey Pyatt. He also says the Right Sector threat is overblown.

Pyatt recently traveled to the western region of Zakarpatye [Zakarpattia], the area that made international headlines in July after armed clashes between police and ultranationalists from the Right Sector in the town of Mukachevo left several people dead.

While the Ukrainian Security Service and National Guard are pressing on with their operation against armed members of the far right group, the US official visited the region that borders the EU, where militants are believed to be hiding in the woods, refusing to lay down arms.

During his visit to Zakarpatye, Pyatt had the opportunity to see many places including Mukachevo, according to Ukrainian agency UNIAN. He said that he "saw a region which seeks unity with Ukraine and wants to participate in the process of reforms launched by the government in Kiev," in comments to the agency during a phone conference on Tuesday.

"The phenomenon of separatism in Zakarpatye is a product of Russian propaganda and Russia Today (RT) producers' imagination," UNIAN cited the US Ambassador as saying.

While it is easy to miss the armed Right Sector fighters hiding deep in the forests of Zakarpatye, especially after President Poroshenko gave orders for security forces to disarm them and all other illegal armed groups in the country, there remains the question as to how an entire local ethnic group calling for the international community to recognize their rights to self-determination managed to slip the US official's attention.

The Rusyns is an ethnic group fighting for survival in western Ukraine. Its self-proclaimed leaders, who have been facing prosecution for what Kiev calls extremist activities, have been seeking autonomy for their region for decades. Over the centuries, this group, with its own language and culture, has been living at the foot of the Carpathian Mountains as part of different countries. Now with over 10,000 of them living within the borders of Ukraine, the Rusyns have been fruitlessly asking the government to agree to a self-governing autonomy since the fall of the USSR.

"The pressure of forced assimilation is so strong that if we don't fight for our status, in just 15 years the Rusyns will only be mentioned in school books," one of the movement's leaders told RT back in 2008. In 2014, Petr Getsko, prime minister of the self-proclaimed Rusyn state, was accused of separatism by Ukrainian Security Services and was put on a wanted list by Kiev authorities during the Yushchenko administration for anti-Ukrainian and anti-state activities.

In 2009, the first World Congress of subcarpathian Rusyns adopted a declaration proclaiming their independence, and appealed to state leaders, parliaments and governments to recognize their republic. This history may have been all but buried by the ashes of battles on the opposite eastern side of Ukraine, but for a recent gathering of the Cross-National Assembly of Transcarpathia with three major national minorities from western Ukrainian regions participating - taking place in none other than the town of Mukachevo.

The meeting was set up by the leaders of the Hungarian, Romanian and Rusyn ethnic groups in order to unite their efforts in defending their minorities' rights and values. The Assembly said it would try to engage Kiev in talks to officially recognize a referendum held in 1991, when "over 78 percent of the residents of the region voted for autonomy."

While this group living in western Ukraine has been calling for dialogue, others - "pro-Ukraine" nationalists - took to arms, with Right Sector leader Dmitry Yarosh calling on the National Guard, and the Ukrainian army and security forces to stop obeying Kiev's orders and refusing to issue an order for his militants to lay down their arms, writing "Nobody can take away our right to a last fight," on his Facebook page. President Poroshenko called the appearance of heavily armed men in Mukachevo, "a thousand kilometers away from the front line," an attempt to destabilize the situation in Ukraine.

Yarosh, who was one of the main drivers of the violent coup in Kiev last year, is wanted by Interpol for incitement of terrorism and extremist activities, and his Right Sector group is banned in Russia as an extremist organization.

He has recently gone as far as calling the current Ukrainian government "traitors" and rallied his supporters for a thousand-strong march through the heart of Kiev this month, where he called on the current authorities to resign. The Right Sector leader said the demonstration marked a "new stage of Ukrainian revolution."

However, according to the US Ambassador speaking to UNIAN, "the whole phenomenon of the Right Sector has been exaggerated by Russian propaganda."

A day earlier, the same Ukrainian news agency cited US geopolitical intelligence firm Stratfor, as saying that "the Right Sector nationalist movement will begin the creation of the so-called 'revolutionary committees' responsible for staging a no-confidence referendum vote against the entire Ukrainian government throughout all of Ukraine."

UNIAN also reported that the congress of the Right Sector organization "decided to rename the Right Sector, changing its status from a military-political movement to a national liberation movement."

So, either UNIAN is promoting Russian propaganda covering a non-existent right wing movement, or maybe something really is wrong in a state where a local conflict, allegedly based on redistribution of wealth, can result in an armed group engaging the government in a standoff across the country.

"The picture of what is happening there today [in Mukachevo] is not black and white. It's just astoundingly black," said Poroshenko, the head of the Ukrainian state, as quoted by UNIAN again. Or is our imagination so rich that we have just read between the lines?


 

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#8
Business Ukraine
http://bunews.com.ua
July 28, 2015
Interview: US combat veteran embedded with the Ukrainian army
American journalist Nolan Peterson reflects on a week spent under near-constant fire in the trenches of east Ukraine
By Peter Dickinson

After more than a year fighting in east Ukraine, this summer the Ukrainian authorities finally initiated an embedding programme allowing foreign correspondents to spend time alongside Ukrainian troops on the frontline of the conflict. The programme aims to give global audiences an insight into the reality of the conflict by allowing journalists unhindered access to Ukrainian forward positions. Getting the Ukrainian military top brass to accept embedded foreign correspondents was no easy task, but the stakes for the country could hardly be higher. Ukraine is fighting for its continued existence as an independent state, and there is growing recognition among army chiefs that the battle against Russian propaganda is every bit as important as the military confrontation on the ground in east Ukraine.

US combat veteran embedded in east Ukraine

One of the first reporters to embed with the Ukrainian troops was US army combat veteran turned war correspondent Nolan Peterson, who writes for The Daily Signal. With his hipster beard and Marine Corps physique, Mr. Peterson is a war reporter straight from Hollywood central casting, but there was nothing glamorous about this particular assignment. He readily admits that none of his experience while on active service in the US army prepared him for the intensity of the fighting in the Donetsk region village of Pisky, where he spent eight days embedded with Ukrainian forces. "In Iraq and Afghanistan you would gear up before heading out on a specific mission. In Pisky, death can come at any moment. You could get killed going to the bathroom. You can die eating dinner or taking a shower," he reflects.

Officially, the conflict in east Ukraine is no longer being fought at full throttle. The Minsk II peace plan signed in February introduced a nominal ceasefire throughout the conflict zone, but Mr. Peterson saw little evidence of any lull in the fighting in and around Pisky. He confirms that on the stretch of the frontline where he embedded, Ukrainian forces remain under near-constant attack from both shelling and snipers. "They're entrenched in these fixed locations and getting hammered every day by heavy artillery and tanks, with drones flying overhead non-stop," he says. "How long can they just sit there, weathering these attacks?'

Volunteer aid provides vital psychological boost

The quiet determination and mental toughness of the Ukrainian soldiers he encountered is a recurring theme in the American correspondent's recollections of his time at the front. "I thought their mental strength was pretty remarkable. What's most amazing is that many these guys are just a two- or three-hour car drive away from their wives and kids, from their friends and families. And yet most of them haven't been home in five or six months. Instead, they're living in this hell. Home is so close, but they might as well be on the moon. I don't know how they have the mental strength to do it," he comments.

Mr. Peterson believes that the support the frontline troops receive from the Ukrainian volunteer movement is of huge psychological importance, serving to remind the soldiers that they are not alone and have not been forgotten by the Ukrainian public. He remains visibly amazed by the scenes he witnessed in Pisky of civilian volunteers driving right up to frontline positions in order to deliver the latest batch of aid, and argues that this continued backing from members of the public plays a key role in helping to maintain army morale.

He was also struck by the hundreds of children's drawings and messages of support that the Ukrainian troops use to decorate their shelters and forward positions. In the hyper-masculine world of frontline combat, the childish innocence of these pictures offered a startling contrast that made a deep impression on the American reporter. "They put those kids' drawings up everywhere," he recalls. "Nobody talks about it openly, but I think those pictures are exactly what sustains them mentally."

Truth as the ultimate infowar weapon

As an embedded journalist, for a brief period Mr. Peterson found himself sharing the day-to-day risks that the Ukrainian troops are living with. He carries a sniper's bullet that he says came within inches of killing him, and claims to have experienced life-threatening situations on every single one of the eight days that he spent at the front. Mr. Peterson' background as a US army combat veteran worked in his favour when it came to winning the confidence of the Ukrainian troops he was shadowing, but he insists that he did not let the inevitable sense of camaraderie that developed between them spill over into his reporting. "Journalists are not soldiers and it is not my job to fight Ukraine's war for them," he states.

Nevertheless, Mr. Peterson is acutely aware that the conflict in east Ukraine has a strong informational component. He argues that the key to winning this information war is honesty. "I have heard a lot of Ukrainian journalists saying that it is pointless trying to fight propaganda with propaganda. You can't beat the Russians at their own game," he reasons. In this sense, the American reporter sees the Ukrainian embedding programme as a step in the right direction. "What they're doing with embedded journalists is actually an indication that the Ukrainians have realized the importance of letting the truth be told, warts and all. This is the best way to push back against Russian propaganda. Western audiences are very distrustful of one-sided or overly positive coverage on any issue. But when you show the naked truth, as I was given the opportunity to do in Pisky, people will treat it with more trust."

Keeping international audiences engaged

Bringing the realities of the east Ukrainian conflict home to international audiences is an increasingly difficult task given the notoriously short attention spans of modern viewers and the information overload of the 24-hour news cycle. Mr. Peterson says one of the biggest challenges he faces as a war correspondent is keeping the Ukraine story relevant to Western audiences. "I didn't want to go on a 'war safari' and just take pictures of things blowing up," he explains, "because American audiences are already inundated with those kinds of scenes from all over the world."

Instead, the Florida-born journalist says he attempts to place coverage of the fighting in east Ukraine within a broader geopolitical narrative. "You can't report on Ukraine in a contextual vacuum," he comments. "It is a far larger story and one that international audiences need to know about. A continental shift is taking place right now. This could be like the 1930s in Europe, and could build up into an open confrontation between a NATO member country and Russia."

Kyiv calm vs. Donbas devastation

Mr. Peterson does not rule out returning to the frontlines for a second spell embedded with the Ukrainian army. If he does choose to head back to the front, it will mean crossing the almost surreal boundary between the devastated Donbas warzone and the rest of Ukraine.

Speaking to Business Ukraine magazine in the comfort of a Kyiv cafe, Mr. Peterson cannot help but marvel at the relative lack of evidence in the Ukrainian capital that the nation is actually at war. This is totally at odds with his own combat memories of Iraq and Afghanistan, where the theoretical battleground encompassed the entire country. For him, this makes the realities of the ongoing conflict on Europe's eastern fringes all the more shocking. "Out there in east Ukraine, there is a weird boundary between war and peace. That's what makes it so different to Afghanistan and Iraq. It's a frontal war, with a contact line between two armies. One of the consequences is that when you are not physically close to the fighting, you don't necessarily feel the presence of war. This makes the psychological transition from war to peace particularly difficult, because it happens so quickly."
 

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 #9
Interfax
July 29, 2015
Russia's ambassador to London explains why Russia-NATO conflict over Ukraine is impossible

Russia's Ambassador to the United Kingdom Alexander Yakovenko rules out the possibility of a military conflict between Russia and NATO over the Ukraine crisis.
 
An open letter of Russia's Ambassador to the United Kingdom Alexander Yakovenko was posted on July 29 on the website of the Russian Embassy.

"There are, indeed, attempts to frighten the European public opinion. But that is not true. A conventional Crimean War Two is not physically possible," Yakovenko wrote.

The ambassador explained in a commentary that his letter was a response to Chatham House's June report titled Russian Challenge, whose authors recommended that the West should prepare for worsening relations with Russia and called for stepping up NATO's role as a key instrument in confrontation with Russia.
"Due to defensive systems developed at the time of the Cold War and perfected over the past ten years, NATO just cannot deploy its assets close enough to engage our armed forces. In Pentagon's parlance, those weapons, never tested in real hostilities, deny access to the theatre," he said.

NATO military analysts proceed from the assumption that "with the systems deployed in the Crimea we control the entire water space of the Black Sea and 40% of its airspace," the diplomat said.

"You just extrapolate this on to the whole length of our western border on land and in sea, including the Baltic Sea and the Arctic, to see that no direct engagement is possible under these circumstances. It is, probably, upon this analysis, that the U.S. Administration promptly concluded that the Ukraine crisis has no military solution," Yakovenko said.
 
"Were NATO to decide to deploy its forces beyond the range of those weapons, it would be another stupid Phoney War [a period on the Western Front during WWII between September 1939 and May 1940] with the prospect of nuclear escalation as additional paralyzing factor," he said.

While the Conventional Armed Forces in Europe Treaty (CFE Treaty) "is dead because of NATO countries' intransigence," the Open Skies Treaty is "in operation and provides enough transparency for everybody to see that the said calculus is there to stay" and "cannot be changed by increased defense budgets, or by way of armor rides and WWII-type military exercises," he said.

"In XXIst century there are other ways to make the point, in any case not by armored columns, pincer movements and occupation. British military experts know that well enough," he said.

"I am sure that nobody in Europe and the U.S. is mad enough to contemplate nuclear exchanges," he said.

"Britain is, too, a nuclear power. By the way, collectivization of nuclear weapons within NATO is not allowed under the NPT," he said.

"We are concerned over the U.S. plans to deploy anti-missile assets in Europe as its forward defense against our nuclear deterrent. It would destroy the strategic stability, giving the U.S. an edge in case it decides to strike first. So, we have to plan for all contingencies," Yakovenko said.

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 #10
www.rt.com
July 30, 2015
Russia vetoes MH17 tribunal draft at UN Security Council

Russia has vetoed a draft of a UN Security Council resolution calling for an international tribunal on the crash of the Malaysian Airlines MH17 flight over eastern Ukraine last July and classifying the plane's downing as a threat to peace and security.

Eleven UN Security Council (UNSC) members voted in support of the Malaysia-proposed draft resolution, with Angola, Venezuela and China abstaining.

This was enough for the resolution to pass, but Russia applied its veto right as a permanent UNSC member.

The vote was preceded by Security Council Chairman and New Zealand foreign minister Murray McCully announcing a minute of silence for the MH17 tragedy victims.

Despite the veto, Moscow is ready to assist the investigation into the reasons for the Malaysian Boeing 777 crash, Russian UN envoy Vitaly Churkin said.

"Russia stands ready to cooperate in the conduct of a full independent and objective investigation of the reasons and circumstances of the crash," he said.

The Russian envoy also stressed that Malaysia and its backers submitted the resolution already knowing that it would be vetoed.

"This, in our view, indicates the fact that political purposes were more important for them than practical objectives. This of course is regrettable," he said.

Churkin noted that Russia had repeatedly said that it wouldn't support the tribunal "due to the fact the UNSC resolution 2166 [of 2014] didn't qualify the Boeing tragedy as a threat to international peace and security."

"It is difficult to explain how the event, which wasn't considered a threat to international peace and security a year ago, now suddenly becomes one," he wondered.

The Russian envoy also pointed out that there were no precedents of the UNSC creating an international tribunal to bring justice to those responsible for a transportation catastrophe.

The expertise of previous international tribunals on "Yugoslavia and for Rwanda, can hardly be considered successful in view of their complexity, susceptibility to political pressure, high cost and extremely long proceedings," he added.

Malaysian transport minister, Liow Tiong Lai, told the council members that Russia's veto sends a "dangerous message of impunity to the perpetrator of this heinous crime."

US envoy, Samantha Power, was also displeased with the outcome, saying that "no veto will stand in the way of this heinous crime being investigated and prosecuted."

"Efforts to deny justice only intensify the pain of the victims' families, who have already endured more than any of us can fathom. It is the effect of Russia's veto today," she said.

Aviation incidents, even as murky as the downing of MH17, are not normally a matter for the UN Security Council to tackle on its own, international lawyer Thomas Sima told RT.

"The question is, 'Why does the UN see the need to take over something that is already being handled through other channels?' And the only reason that I can think of is that the real reason is political," he said.

The tribunal resolution on MH17 was pushed by Washington because it wants to have control over the proceedings, which is not the case with the ongoing Dutch investigation, believes Paul Craig Roberts, a former Reagan administration senior official.

"Well, Washington is able to block the [Dutch] report, but it's not able to completely falsify it. So it has not turned to the UN. It wants a new investigation, one that Washington can control," he told RT.

Before Wednesday's vote, Moscow had openly stated that it would prevent the Malaysia-proposed document from passing.

Russia warned that the tribunal would lead to even more confrontation in the international arena as it is intended to assign blame to those who Washington wishes to finger as responsible for the crash.

The Russian side noted that although the MH17 downing was a criminal offense, it was not a threat to global security.

Dutch investigators looking into the MH17 tragedy said that the plane was shot down while flying over the conflict zone near Donetsk.

However, they have not yet established responsibility for the tragedy, as pro-Kiev forces were engaged in combat with rebels from the self-proclaimed republics in eastern Ukraine at the time.

The Ukrainian authorities and the West blame the Donetsk militias for downing the plane, saying that they used a Buk surface-to-air missile allegedly provided by Russia.

The rebels deny these accusations, and Moscow has repeatedly warning against putting blame on anyone before the investigation into the crash has been completed.

The Dutch Safety Board that has been heading an international investigation into the cause of the crash is due to release its official report in October, while the criminal investigation is expected to continue until the end of this year.

A draft resolution submitted by Malaysia proposed the establishment of a tribunal to investigate the incident, with judges and the prosecutor to be appointed by the UN Secretary General.

The document also called on member states to adhere to the 2014 Resolution 2166 and provide maximum assistance to the international investigation into the incident.

The draft was supported by several nations in the UNSC, including the Netherlands and Ukraine.

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 #11
Interfax
July 30, 2015
Kremlin: Probe into MH17 crash cannot be turned into 'political inquisition'

Moscow is categorically against the politicization of an investigation into the Malaysia Airlines Flight 17 crash in southeastern Ukraine, Russian presidential press secretary Dmitry Peskov told journalists on July 30 when asked why Russia has vetoed a UN Security Council draft resolution on establishing an international tribunal to prosecute those responsible for the disaster.

"Russia, as has been said on numerous occasions, including by President Vladimir Putin and other of our high-ranking officials, has consistently favored a genuine investigation into this plane crash and the identification of those responsible for it," Peskov said.

"Russia has been very insistent in making sure that this investigation should be real, free from any politicization, and that this investigation cannot be taken advantage of as a pretext for some political inquisition," Peskov said.

"Russia has repeatedly addressed its questions to the investigators, and Russia has repeatedly expressed its regret that it cannot be engaged and cannot cooperate with those handling the investigation. Unfortunately, we have not always received answers to our questions in connection with the circumstances of this tragedy," he said.

"The investigation should be brought to an end impartially and without bias, so that the full amount of information is considered in the course of the investigation," he said.

Kiev's claims that Russia's decision to block a draft resolution allegedly comes as de facto recognition of Moscow's guilt are "absurd", Kremlin spokesman told.

"This statement is totally absurd," he said.

"When Russia repeatedly asked the question about the whereabouts of the materials linked with the Ukrainian side's air traffic controllers' communications, etc, at that time, regrettably, no statements were made by Ukraine," Peskov said.

"That is why such claims are absurd in this case," he said.   

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 #12
Why is Russia against international tribunal over MH17 flight crash?
By Tamara Zamyatin

MOSCOW, July 29. /TASS/. In the context of the on-going information war against Russia, being waged in concert mostly by the United States and Ukraine, creation of an international tribunal for probing into the crash of the Malaysian Airlines' Flight MH17 over Donetsk in Ukraine last summer would be a politicized show trial, and not a means of establishing the truth, polled experts told TASS.

A passenger jet liner Boeing-777-200ER (Flight MH17) en route from Amsterdam, the Netherlands, to Kuala-Lumpur, Malaysia, crashed in the east of Ukraine's Donetsk Region on July 17, 2014, killing all 283 passengers and fifteen crew - citizens of ten countries. The greatest suspicion is the plane was shot down by a surface-to-air or air-to-air missile. The Ukrainian authorities in Kiev and the militias of the self-proclaimed Donetsk People's Republic blamed each other for the plane's loss.

On Wednesday, July 29, the UN Security Council is to put to the vote a draft resolution on creating a tribunal to investigate the MH17 disaster. Malaysia's draft has the backing of the Netherlands, Ukraine, Australia and Belgium. This document a little more than two pages long qualifies the incident as a threat to international peace and security and envisages creation of an international tribunal for prosecution of those responsible for criminal actions that resulted in the loss of the Malaysian passenger liner.

Russia, one of the five permanent UN Security Council member-states with the right of veto, has already made it quite clear that it will not support the resolution. President Vladimir Putin on July 16 said the idea of creating an international tribunal before the official investigation was over looked premature. Russia's UN envoy Vitaly Churkin said Russia would certainly vote against and certainly use the right of veto, if need be. Earlier, Russia presented an alternative draft resolution in support of the independent international investigation of the air disaster.

Deputy Director of the Institute of the US and Canada Studies under the Russian Academy of Sciences, Pavel Zolotaryov, believes that creating a tribunal would be reasonable only if alongside the investigation of the MH17 crash it would also address the issue of exposing and prosecuting those responsible for the loss of a Russian air liner when Ukraine was holding a military exercise in 2001 and the shooting down of an Iranian passenger plane by the United States.

"Far more crucial than the creation of a UN tribunal would be an impartial and transparent investigation of the causes that resulted in the Malaysian Boeing's crash. Otherwise it turns out that the UN Security Council plans to put the cart before the horse. This is not logical," Zolotaryov told TASS.
Russian Permanent Representative at the United Nations VItaly Churkin

"Amid the information war, being waged by the United States, the Western countries and Ukraine, Russia was pointed to as the culprit before the investigation is over. Ukraine, in whose territory the plane crashed is interested in discrediting Russia to ward off charges against itself. The investigation is being conducted in a very secretive way. Ukraine refuses to provide the necessary documentation either to Russia or to the panel of inquiry. This explains why it is against the adoption of a resolution for creating a tribunal and insists on an alternative one pressing for an independent investigation of the plane's crash," Zolotaryov said.

Lecturer at the political theory department of the Moscow state institute of international relations (MGIMO), Kirill Koktysh, is certain that the MH17 disaster, however tragic it may look, is not a threat to peace. "The UN Security Council's draft resolution qualifying the air crash as a threat to international peace and security is devoid of any foundation," Koktysh told TASS.

"The practice of international tribunals, including the International Tribunal for former Yugoslavia in the Hague, has demonstrated its extreme ineffectiveness and politicization. The Hague Tribunal was in fact turned into a tool to persecute Yugoslavia's former leadership. The tribunal's reputation is doubtful and its verdicts, groundless. Russia is very skeptical about the idea of another international tribunal some wish to create before the investigation of the Malaysian Boeing disaster has been completed," Koktysh said.

"Also, it is very wrong to compare the number of passengers killed in the MH17 disaster and the thousands of civilians who died at the hands of the Ukrainian military in the southeast of the country. Nevertheless it would be quite appropriate to draw the UN Security Council's attention to the need for exposing and punishing war criminals in Ukraine alongside an impartial investigation of the air liner's crash," Koktysh said.

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 #13
Counterpunch.org
July 29, 2015
Ukraine: Close to the Edge
By CONN HALLINAN

"If you want to talk about a nation that could pose an existential threat to the United States, I'd have to point to Russia. And if you look at their behavior, it's nothing short of alarming."
- Gen. Joseph F. Dunford Jr. Chair U.S. Joint Chiefs of Staff

"This is not about Ukraine. Putin wants to restore Russia to its former position as a great power. There is a high probability that he will intervene in the Baltics to test NATO's Article 5."
- Anders Fogh Rassmussen, former Head of NATO

It is not just defense secretaries and generals employing language that conjure up the ghosts of the past. Presidential candidate Hillary Clinton used a "Munich" analogy in reference to Russian President Vladimir Putin, and a common New York Times description of Russia is "revanchist." These two terms take the Ukraine crisis back to 1938, when fascist Germany menaced the world.

Yet comparing the civil war in the Ukraine to the Cold War-let alone Europe on the eve of World War II-has little basis in fact. Yes, Russia is certainly aiding insurgents in eastern Ukraine, but there is no evidence that Moscow is threatening the Baltics, or even the rest of Ukraine. Indeed, it is the West that has been steadily marching east over the past decade, recruiting one former Russian ally or republic after another into the North Atlantic Treaty Organization (NATO).

Nor did the Russians start this crisis.

It began when Ukrainian President Viktor Yanukovych turned down a debt deal from the European Union (EU) that would have required Kiev to institute draconian austerity measures, reduce its ties to Russia, and join NATO through the backdoor. In return, Ukraine would have received a very modest aid package.

Moscow, worried about the possibility of yet another NATO-allied country on its border, tendered a far more generous package. While the offer was as much real politic' as altruism, it was a better deal. When Yanukovych took it, demonstrators occupied Kiev's central square.

In an attempt to defuse the tense standoff between the government and demonstrators, France, Germany and Poland drew up a compromise that would have accelerated elections and established a national unity government. It was then that the demonstrations turned into an insurrection.

There is a dispute over what set off the bloodshed-demonstrators claim government snipers fired on them, but some independent investigations have implicated extremist neo-Nazis in initiating the violence. However, instead of supporting the agreement they had just negotiated, the EU recognized the government that took over when Yanukovych was forced to flee the country.

To the Russians this was a coup, and they are not alone in thinking so. George Friedman, head of the international security organization Stratfor, called it "the most blatant coup in history," and it had western fingerprints all over it. U.S. Assistant Secretary of State Victoria Nuland and U.S. Ambassador Geoffrey Pyatt were recorded talking about how to "midwife" the overthrow of Yanukovych and who to put in his place.

Besides making Kiev a counterproposal on resolving its debt crisis, no one has implicated the Russians in any of the events that led up to the fall of Yanukovych. In short, Moscow has been largely reacting to events that it sees as deeply affecting its security, both military and economic.

Its annexation of Crimea-which had been part of Russia until 1954- followed a referendum in which 96 percent of the voters called for a union with Russia. In any case, Moscow was unlikely to hand over its strategic naval base at Sevastopol to a hostile government.

Somehow these events have morphed into Nazi armies poised on the Polish border in 1939, or Soviet armored divisions threatening to overrun Western Europe during the Cold War. Was it not for the fact that nuclear powers are involved these images would be almost silly. NATO spends 10 times what Moscow does on armaments, and there is not a military analyst on the planet who thinks Russia is a match for U.S. To compare Russia to the power of Nazi Germany or Soviet military forces is to stretch credibility beyond the breaking point.

So why are people talking about Article 5-the section of the NATO treaty that treats an attack on any member as an attack on all-and Munich?

The answer is complex because there are multiple actors with different scripts.

First, there are the neoconservatives from the Bush years that have not given up on the Project for a New American Century, the think tank that brought us the Afghan and Iraq wars, and the war on terror. It is no accident that Nuland is married to Robert Kagen, one of the Project's founders and leading thinkers. The group also includes former Defense Department Undersecretary Paul Wolfowitz, Elliot Abrams, and former UN Ambassador John Bolton.

The neocons believe in aggressively projecting American military power and using regime change to get rid of leaders they don't like. Disgraced by the Iraq debacle, they still have a presence in the State Department, and many are leading foreign policy advisors for Republican presidential candidates, including Rick Perry, Ted Cruz, and Jeb Bush. They are well placed and persistent, and if Bush is elected president there is talk that Nuland will become Secretary of State.

Then there are the generals, who have a number of irons in the fire.

There is a current in NATO's leadership that would like to see the alliance become a worldwide military confederacy, although the Afghan disaster has dampened the enthusiasm of many. In fact, there is not even a great deal of support within NATO for enforcing Article 5, and virtually none for getting involved with sending arms to the Ukraine. Most NATO countries don't even pony up the required level of military spending they are supposed to, leaving the U.S. to pick up 70 percent of the bills.

But there is nothing like conjuring up a scary Russian bear to loosen those purse strings. And indeed, a number of former scofflaws have upped their military spending since the Ukraine crisis broke.

The military and its associated industries-from electronics companies to huge defense firms-need enemies, preferably large ones, like Russia and China, where the weapons systems are big and the manpower requirements high.

Right now there appears to be a split among U.S. decision makers over whether Russia or China is our major competitor. For the neocons and most of the Republican candidates, the Kremlin is the clear and present danger. For the Obama administration and most Democrats-including Hillary Clinton-China is the competition, hence the so-called "Asia pivot" to beef up military forces in the Pacific and establish a ring of bases and allies to obstruct Beijing's ability to expand.

One can make too much of this "division," because most of these currents merge at some point. Thus the sanctions targeting Russia's energy industry also squeeze China, which desperately needs oil and gas.

In response to sanctions, Russia is shifting its supplies and pipelines east. Russia and China have also begun establishing alternatives to western dominated financial institutions like the World Bank, the International Monetary Fund and the Asian Development Bank. Organizations like the BRICS countries-Brazil, Russia, India, China and South Africa-have established a development bank and currency reserves, and the new Chinese-initiated Asian Infrastructure Development Bank has already attracted not only Asian nations, but the leading European ones as well. The Shanghai Cooperation Organization now embraces over three billion people.

The U.S. has tried to derail a number of these initiatives.

The sanctions against Russia have made it difficult for Moscow to develop oil and gas in the arctic, and Washington pointedly told its allies that they should not join the China development bank. Both campaigns failed, particularly the latter. Only Japan and the Philippines heeded the American plea to boycott the bank. And Asia's need for energy is overcoming many of the roadblocks created by the sanctions.

However, the campaign against Russia has damaged the Kremlin's energy sales to Western Europe. The EU successfully blocked a Russian pipeline through Bulgaria, and the Americans have promised that its fracking industry will wean Europe off Russian energy. Fracking, however, is in trouble, because Saudi Arabia stepped up production and crashed oil prices worldwide. A number of U.S. fracking industries have gone belly up, and the industry is experiencing mass layoffs.

Stay tuned for EU-Russian energy developments.

Why are we in a dangerous standoff with a country that is not a serious threat to our European allies or ourselves, but does have the capacity to incinerate a sizable portion of the planet?

At least part of the problem is that U.S. foreign policy requires enemies so that it can deploy the one thing we know best how to do: blow things up. The fact that our wars over the past decade has led to one disaster after another is irrelevant, explained away by "inadequate" use of violence, lack of resolve or weak-kneed allies.

Americans are currently looking at a host of presidential candidates-excluding the quite sensible Bernie Sanders-who want to confront either Russia or China. Both are hideously dangerous policies and ones that are certainly not in the interests of the vast majority of Americans-let alone the rest of the planet.

It is really time to change things, and, no, the bear is not coming to get you.

Conn Hallinan can be read at dispatchesfromtheedgeblog.wordpress.com

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 #14
The Vineyard of the Saker
http://thesaker.is
July 28, 2015
Oleg Tsarev on the current situation in the Donbass and in Ukraine

SOURCE. Translated by Carpatho-Russian. Edited by Tatzhit.

From the editor:  Ex-MP Oleg Tsarev was the last truly "Pro-Eastern" politician in Ukraine who attempted to act through democratic channels, e.g. running in a presidential election against Poroshenko. After he was severely beaten by a nationalist mob in Kiev, he withdrew his candidacy and called on all men of honor to do the same, saying the election is undemocratic and it is illegal to hold one while there is a civil war unfolding. Soon after, his house was burned down, and Kolomoiski (according to Tsarev's claims and a phone recording) put a price of $1M on his head.

From that point on, he joined the supporters of the Constitution and continued to play a prominent role in the DPR/LPR politics, although not being a military man, his influence diminished once open warfare broke out. Here is a rather interesting (if unproven) recent analysis by him.

Interviewer: Oleg, let's begin with Ukraine. You have friends who have stayed there, and you have certain exclusive sources who regularly provide you private information. On that basis, what do you think about the situation with the economy of Ukraine, and what are the strategic prospects for the country in the near future?

Oleg Tsarev: The situation is close to catastrophic. But, in general, this does not bother either the Kiev authorities or their bosses from the USA. Americans are actually interested in Ukraine declaring default. Simply because it will be easier and cheaper to buy up the capital assets, and the decreasing standard of living will make more people willing to join the army and serve for the salaries it pays. The army itself, Americans will support, supplying everything needed, including weapons.Judging by the fact that Victoria Nuland personally traveled to Kiev to ensure a vote in the Verkhovna Rada to introduce changes to the Constitution of Ukraine, and that due to her arrival the special status of the "separate regions of Donetsk and Lugansk Oblasts" is included in the primary text of the Constitution, we may infer that in the negotiations between Russia and USA on Iran, they also discussed Ukraine.
Evidently, it was for a good reason that Kerry flew to Moscow on May 12th, and Nuland came there on May 17th. The outlines of the agreements are clear. Russia, the European Union, and now also the USA are forcing Poroshenko to implement the Minsk Accords. In this way, a foundation for political settlement will be laid down. In accordance with the Minsk Accords, the DPR and LPR must re-integrate within Ukraine, and get a special status, similar either to "autonomies" or to subjects in a confederation. The Donbass will have a common economic space with Ukraine, but will preserve the right to make independent decisions on most issues. Kiev's observance of its obligations to the Donbass will be guaranteed by the armies of the DPR and LPR with all their armament, renamed into "people's police forces".

Evidently, in the near future we shall observe the creation of a demilitarized region around Donbass, from which not just heavy artillery but also lightly armed soldiers will be withdrawn. I think that this process will begin as soon as it is tested with the successful example of Shirokino. Clashes and shelling will cease as soon as the soldiers can't see each other in their rifle sights. The next step will be a general amnesty and lifting the economic blockade of Donbass by Kiev.

The most humiliating thing for the Kiev authorities is that they were not invited to these negotiations conducted by Russia with USA and EU, no one asked their opinion.But with all that, I would not get too hopeful just yet.

The immense numbers of armed paramilitaries consist of radicals, whose life is war and who do not wish to lay down arms. It is also true that the population of Donbass, the majority of them having endured so much at the hands of Kiev during ATO, is not willing to return to Ukraine. From my point of view, the process of reconciling the Donbass with Ukraine can hardly be successful while those who unleashed civil war are still in power. And while people like Poroshenko, Yatseniuk, Turchinov, and Kolomoyskiy are not yet brought to justice for their crimes.

Still unresolved is one of the chief contradictions at the very foundation of the Ukrainian state -a state formed by the Russian and Ukrainian people - that the Russian language is not an official language. Nor it is not possible to call USA a reliable partner. The CIA employees who are controlling the State Security and the Armed Forces of Ukraine are not about to return to the USA. No one is about to give actual control of the country back to the people of Ukraine. Hence, of course, we must do everything we can to stop the bloodshed, but at the same time we need to keep the powder dry.

Unfortunately, I think woes and problems will plague my long-suffering homeland for a long time. Not long ago, an acquaintance who is a leader of an NGO in Dnepropetrovsk came to me and told me that they brought him to the Security Service [building], and among many other questions, they asked him questions about me.

The questions were about the period when I was engaged in politics in Dnepropetrovsk. At a meeting there was a man who remained silent and only listened to the answers, but when his phone rang, he began to talk on the phone in pure English. I am convinced that no matter how the conflict in Donbass develops, the Americans will do everything they can to keep Ukraine under their control.

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 #15
Izvestia
July 23, 2015
Pundit predicts collapse of Ukraine, claims southeast could join Russia
Aleksandr Chalenko: "Minsk-2: what next? Journalist Aleksandr Chalenko - on the dirty peace with Ukraine that is saving the Donetsk Basin from destruction"]

And so, it would appear, last week the Minsk process reached deadlock. Let me recall that the Ukrainian Supreme Council voted last Thursday for presidential amendments concerning the decentralization of Ukraine in which, on the one hand, there was nothing about special status for "individual regions of Donetsk and Luhansk", and on the other hand - these same amendments had not been agreed with the DPR [Donetsk People's Republic] and the LPR [Luhansk People's Republic], as required by the Minsk agreements.

In practice, this meant that Minsk-2 had been aborted, because all these amendments without the agreement of Donetsk and Luhansk "are to disregarded."

At the same time, Poroshenko knew perfectly well that the most important words in the Minsk agreement are "by agreement with the DPR and the LPR." But he pretended that these words were not there. Well then...

In the upshot, everyone began to wonder what would happen next: the resumption of combat operations and yet another death trap for the Ukrainian Army? The experience of the last one showed that everything would indeed come to this.

Therefore, evidently, when the DPR and LPR leadership unilaterally withdrew heavy equipment from the front line, Petro Oleksiyovych's cunning brain for some reason took this as a hint: If you do not want peace, you will receive war. He evidently thought that he saw a propaganda trick in this unexpected pacifist step on the part of the Novorossiya Army (they want by this withdrawal, he thought, to show the world that they wanted peace), after which combat operations would follow and then yet another defeat for Ukraine.

For the soul, "exhausted by mineral water" [misquotation or adaptation of phrase from "The Twelve Chairs", perennially popular Soviet-era comic novel by Ilf and Petrov; implies world-weariness or alcoholism], of Poroshenko, down whose neck the restless Right Sector is breathing and who faces the possible collapse of his already falling poll numbers, such a prospect was not needed. He wants for everything to be chocolate-coated [in apple-pie order, but satirically alluding to the source of Poroshenko's fortune - he is often referred to as "the chocolate baron"].

As a result, he had to sign an agreement on a 30-km buffer zone along the entire front line. This, you will agree, was on the whole unexpected.

Undoubtedly, he was also "helped" to make this step by pressure from Berlin and Paris. [German Chancellor Angela] Merkel and [French President Francois] Hollande need peace in the Donets Basin. They are inexorable here. They understand perfectly well that war only plays into the hands of the Americans. It strengthens their presence in Ukraine.

The most interesting thing is that, despite Europe's participation together with Washington in economic sanctions against Russia, there is one thing that unites Moscow, Berlin, and Paris - an unwillingness to allow the Americans to participate in the Minsk process. It was precisely for this [viz., an invitation to participate in the Minsk process] that Washington asked Moscow a few months ago, but the Kremlin was inexorable and found support in this from its German and French partners.

They all understand perfectly well that the involvement of the Americans in the Minsk process would make Kiev more destructive and disobedient.

And so, what will happen next?

Evidently, it is peace, not war, that awaits the Donets Basin. It needs peace for two things.

The first is state building. To continue fixing the economy and to develop the social sphere.

The second is the continuation of the process of becoming de facto part of Russia. Incidentally, information has already appeared in the Russian mass media to the effect that the DPR and the LPR expect in the near future the mass issue of Russian passports to everyone who wants them, as happened before in Abkhazia and South Ossetia.

As soon as this happens, the return of the Donets Basin to Ukraine will no longer be possible. Moreover, this will change the view of the war in Russia itself. The war is currently perceived in Russia as Ukraine's war against the Donets Basin's ethnic Russians, who are nevertheless citizens of Ukraine. After the issue of passports, this will be a war against Russian citizens.

Is it possible to talk about some kind of new offensive by the Novorossiya army? No. Because it does not have sufficient forces for such an offensive and for the liberation of the entire Ukraine-occupied territory of the Donets Basin at a more or less acceptable price.

Because there are insufficient forces, the cities of Donetsk and Luhansk regions could expect protracted fighting that would lead to serious damage and to the destruction or exodus of the local population, and, of course, to serious losses among the personnel of the Novorossiya army. This was graphically illustrated by Debaltseve. No one will contemplate this.

An offensive by the DPR and the LPR is possible only as a counteroffensive in the event of yet more aggression on the part of Ukraine.

Only one thing remains for the Donets Basin, which, let me repeat, has begun de facto integration with Russia: to wait. Ukraine is falling apart at the seams: The collapse would have occurred already last year; the country is being saved from this only by external management. But is this producing any positive results? No. This means that, at some moment or other, it too will cease to help.

Minsk-2 will not save Ukraine; it has been condemned. It saves the citizens of Europe, Novorossiya, and Ukraine itself from the horrors of the collapse of Ukraine as a result of war. No one - neither Europe, nor Russia - needs war. That is why they decided on Minsk-2.

The collapse will be gradual, and our task is to snatch up historical Russian territories at the right time.

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 #16
Kyiv Post
July 29, 2015
Transcript of July 28 press briefing by Tombinski, Pyatt

Editor's Note: The following is a transcript of the press briefing on July 28 by European Union Ambassador to Ukraine Jan Tombinski and U.S. Ambassador to Ukraine Geoffrey R. Pyatt. The event was hosted by the Brussels Media Hub.

Moderator: Thanks so much, Zach. Greetings to everybody from the U.S. Department of State. I would like to welcome all of our participants who are dialing in from across Europe this morning and thank all of you for joining in this discussion.

Today we are pleased to be joined from Kyiv by two very distinguished diplomats, EU Ambassador to Ukraine Jan Tombiński and U.S. Ambassador to Ukraine Geoffrey Pyatt. They are going to be offering you their assessment of the situation in Ukraine, and as you know from their bios they have a wealth of experience so we're quite grateful for their time today.

We're going to begin today's call with opening remarks from Ambassador Tombiński and then from Ambassador Pyatt, and then we will turn it over to your questions.

Today's call is on the record and it is being recorded. With that, I will turn it over to you, Ambassador Tombiński. Please go ahead.

Ambassador Tombiński: Good morning and welcome to this discussion on where we are in Ukraine and how are the relations between Ukraine and the European Union. Thank you very much for the invitation to join this panel and this discussion with media.

For almost one year the European Union and Ukraine are bound by the formal agreement of the association which is the driving engine for reform and is the driving document for our relations. But it did not start a year ago. It always has a history.

This association, response to the Ukrainian request stated to the European Union 10 years ago under President Viktor Yushchenko at the time, being followed under President Viktor Yanukovych and is now in the implementation in new circumstances with President Petro Poroshenko and the Ukrainian government. So I wish to emphasize this continuity in the work and this continuity in the work that has been done in full transparency to all partners.

Negotiations over the association agreement were run over four years. Documents were exchanged and clarified, signed, disclosed to the media so the European institutions and Ukraine, so nothing has been hidden. Therefore this document was, in our opinion, a kind of a win/win situation. The objective of this association was to help Ukraine to overcome the systemic weaknesses from the past, to give a boost to reform. Administration, economy, the way of how the country works, without any obligation to cut off relations with Eastern partners, with Russia or with other third partners. It was a solution that proposed to add to existing contacts another one of an evolutionist nature, expected to bring results over 10 years. We never expected that we will be implementing this document under such dramatic circumstances as now and under such dramatic pressure from Russia against this association.

I still remember President Vladimir Putin saying in 2005 that he has nothing against Ukraine joining the European Union, but suddenly with other ideas that subsequently pop up, this direction has been questioned and already in 2013, well before the EuroMaidan Revolution, Ukraine was under huge economical pressure from Russia to try to impose the commercial ban on different Ukrainian goods with the aim to force Ukrainian leadership still under President Yanukovych to change opinion and not to sign this agreement, as well as other ways of pressure -- gas talks, gas negotiations and pricing was part of this negotiation as well as financial flows. It ended up with all these known events that started in November as a response to a sudden call by President Yanukovych to postpone the signing of the association agreement, but the society hadn't been taken into account in it and the society said no. We were prepared for it, we were told it was good, we were told by the leadership that we should embark on this direction and therefore we wish to stay on track.

These are my preliminary remarks only to frame what is going on between the European Union and Ukraine now.

Ambassador Pyatt: This is Geoff. First of all let me say what a pleasure it is to be doing this jointly with Ambassador Tombiński. Certainly for the United States the defining principle of our policy towards Ukraine has been partnership with Europe and coordination with our European partners.

One of the very first things I did upon arrival in Ukraine two years ago was sitting down with Ambassador Tombiński. I will always remember when I think back on this dramatic two years the twin bookends of Jan and I traveling together to Kharkiv in October of 2013 to go see Yulia Tymoshenko in her hospital jail cell, and then three months later on the 23rd of February, Ambassador Tombiński and I on an early Sunday morning going to meet with Yulia Tymoshenko in her office hours after President Yanukovych fleeing the country and the political transformation that began therein.

So this is a critically important partnership for us. Our policy has been successful to the extent we have remained united. We have exactly the same strategic objectives vis-�-vis Ukraine -- a country which is free, whose territorial integrity is upheld, and a country which is moving towards closer alignment with European values and European institutions.

At the level of principles, I have said publicly that Ukraine is fighting two wars. One is the war against Russian aggression and the second one is the war for reform that Ambassador Tombiński described so well.

Let me talk a little bit about the first one because it's important to understand sitting in Brussels or elsewhere in Europe that there is a war still going on here. Russian drones are operating over Ukrainian territory every single day. Russian cruise surface-to-air missile systems are operating on Ukrainian territory. And as we were reminded by the capture of a Russian soldier and Russian origin ammunition this weekend, Russia continues to fuel the conflict here with the military equipment that it is sending across Ukraine's sovereign international border.

Just in the past 24-36 hours there has been continued fighting in Uglegorsk which knocked out a thermal power plant, in Avdiivka targeting a main industrial coke facility, and in Shyrokyne, a clash which injured a monitor of the OSCE. And I want to underline our deep appreciation and respect for the courageous work that SMM and its monitors are doing on the ground.

The road map to a solution of this terrible war lies in full implementation of the Minsk Agreement. Ukraine is implementing Minsk. Russia and its proxies are not. That's very clear from our standpoint.

In this context we strongly support President Poroshenko's initiative for a 15 kilometer withdrawal of heavy weapons all up and down the contact line. We hope that that will be executed as quickly as possible. We also welcome, the United States strongly welcomes the move over the past 24 hours by the Ukrainian government to redeploy the Azov and Donbas battalions out of the flash point town of Shyrokyne and to move towards military disengagement from that town, all the while reinforcing the defenses of Mariupol. And it's important to recognize all of this territory that we're talking about along the Azov Sea is Ukrainian territory. This is Ukrainian sovereign territory. Everything up to the international border and that's not going to change.

I would also note for the European audience the critical humanitarian crisis that is also a consequence of Russia's aggression in the East. It is totally unacceptable for the separatists to be blocking access to Ukrainian territory, to territory controlled by Russia and the separatists, by humanitarian shipments. In this regard I would note that we are now on day 11 of the so-called DNR blocking shipments from Rinat Akhmetov's humanitarian convoys intended to relieve the greatest victims of this war. Rinat Akhmetov and others like him from Ukrainian civil society and Ukrainian volunteer groups who have tried to support displaced people and the victims of this war. It's one of the untold stories of Ukrainian resilience during this conflict. The strength of Ukrainian civil society organizations.

We do not believe there is a military solution to this conflict, but we do believe that Ukraine has a sovereign right to defend its own territory and that is the logic of our security sector assistance which has now reached 245 million U.S. dollars; that is the logic of our continued training programs at Yavoriv. And in this regard I would note both the important European partnerships we have with countries like the UK, Lithuania, Poland, who are working with us to help enhance the capabilities and professionalism of Ukrainian forces, but also the 18 NATO countries and partner countries that are part of our ongoing Rapid Trident Exercises at Yavoriv.

A second front of the war is the war for reform. It's important to remember that the conflict area is only three percent of Ukrainian territory. In the rest of Ukraine the process of reform and modernization is moving ahead. The association agreement that Ambassador Tombiński spoke of provides the critical road map in that regard.

There is real progress being made. Whether it is cleaning up the financial sector, implementing a new police law and standing up new police forces, advancing reform on the area of anti-corruption, prosecutorial reform, cleaning up the energy sector, reducing the unsustainable seven percent of GDP that Ukraine was investing in subsidies to Naftogaz. These are all challenging and we understand that it's taken great political courage by the Ukrainian government to move on these multiple fronts simultaneously. But we all, and on this issue I think I can speak for both Ambassador Tombiński and myself, we all are impressed by what Ukraine has done so far. We encourage Ukraine to continue moving forward. And we believe that this formula of reform is the right one to build the kind of modern democratic state that the Ukrainian people deserve and which the Ukrainian people have unequivocally chosen through multiple elections.

The last point, then we'll open it to questions. I would just underline the stakes for what's happening here. Our principles and shared transatlantic values are at stake in the conflict underway today in Ukraine. The cardinal principle of respect for international borders and territorial integrity has been jeopardized. Ukraine is the front line of freedom in Europe. Our policies and efforts have been successful over the past year and a half because we have stayed united in our efforts and coordinated in our analysis, and certainly speaking for the U.S. team in Ukraine, we are deeply committed to maintaining that European partnership.

Moderator: Thank you, and thanks to both of you for that overview.

We are now going to begin the question and answer portion of today's call. Our first question today is coming to us from Jane's Defence Weekly, Brooks Tigner.

Jane's: To Ambassador Tombiński, the EU has new train and equip flexibility to provide non-lethal weaponry to partner countries. This was designed originally for Africa but it can apply to Ukraine. Is the EU considering that?

And to Ambassador Pyatt, could you please bring us up to date on where reform of the armed forces go beyond your general statement? What lies ahead?

Thank you.

Ambassador Tombiński: Thank you, and thank you also Ambassador Pyatt, Geoff, for making this point of the common endeavor, joint action in order to protect international law and international principles.

Getting back to your question about the export of non-lethal weapons to Ukraine. There is no embargo of exporting military-related equipment to Ukraine. Therefore, it is in the hands of member states. European Union does not operate as a subject in this field, however the member states are free in doing so if it is not in a breach of international obligations.

I may only leave it to the discussion of the member states to do so, we see representatives of different countries participating in the military drills that Ambassador Pyatt just referred to in Yavoriv and equipment in order to protect Ukrainian soldiers and Ukrainian citizens. It's also coming from different states, Ukrainian authorities advance a figure of nine different European states supplying some non-lethal equipment to Ukrainian armed forces. But we don't do on the level of European institutions a record of collection of all this information.

Ambassador Pyatt: On the reform side, the first point I would make, of course, is that upon Yanukovych's departure the Defense Ministry and the Ukrainian military were afflicted by the same problems of corruption and Soviet era bureaucracy that afflicted much of the Ukrainian administration.

So this government for the past year and a half, since the war with Russia began with the invasion of Crimea, has had to walk and chew gum at the same time. It's been important to continue the process of defense reform while at the same time defending the country's sovereign territory.

It's very clear that the Ukrainian military today is a different and more capable force than that which encountered the little green men of Russia in Crimea in early March of 2014. They have been tested by battle.

You can see, for instance, in the Ukrainian military's successful defense of Marinka in June in response to a Russian and separatist-led land grab in that town, west of Donetsk city, that the Ukrainians have become much better at integrating intelligence, at defending their lines. It's important to underline everything Ukraine has done since the beginning of this conflict has been on Ukrainian sovereign territory, trying to repulse Russian aggression. There is a victim and an aggressor here very clearly.

We have at the invitation of the Ukrainian government sought to support this process of defense transformation, working towards what President Poroshenko has defined as his goal of a NATO standard Ukrainian military. This is Ukraine's choice. We have a Joint Commission on Defense and Security Cooperation chaired by Ukraine's Deputy Minister of Defense which has been a very effective forum with some of our key European partners, again including Lithuanian, Canada, the UK to hear Ukrainian priorities and to answer those priorities and requirements to the best of our ability and resources.

But again, what I want to emphasize in this area is that in all of these cooperative endeavors we are acting at the invitation and at the request of the Ukrainian government. Our policy is about responding to the sovereign choices of Ukraine's elected authorities.

Moderator: Thank you.

For our next question we're going to move over to Hungary and take a question from Po�r Csaba who is with the outlet N�pszabads�g.

N�pszabads�g: Good morning. I've got a few questions to both of the ambassadors if you don't mind.

The first concerns the Transcarpathia region. How do you think, can some kind of process of destabilization go on in this region after the Mukacheve incident two weeks ago which has actually not been resolved still.

The second question is, how do you evaluate the role of the far right Pravy Sektor, its activity lead to opening a new front this time in the West for the Ukrainian government?

The third one is, do you think the position of the government and Mr. Poroshenko is firm enough to conclude and implement real reforms to end the Donbas war?

Ambassador Pyatt: Let me start and I'll ask Ambassador Tombiński to speak to some of this as well.

First, on your last question about the commitment to reform, there is no doubt in my mind of the Ukrainian government's resolve to carry forward the process of reform and implement the Minsk Agreement. What is in great question is Russia's willingness to do what it undertook as part of the Minsk Agreement.

As regards the situation in Transcarpathia, I of course was there last week. I was honored to spend some time with Governor Moskal. The United States fully endorses the view of Governor Moskal, Interior Minister Avakov and President Poroshenko that the use of force must be the exclusive domain of the Ukrainian government.

In this regard I would argue that the whole phenomenon of Pravy Sektor has been vastly exaggerated by Russian propaganda outlets. The right wing in Ukraine -- Pravy Sektor, Svoboda, other groups, clearly have not found political resonance. The violence that took place in Mukacheve, which I assess to be resolved, and I was in Mukacheve and in Uzhgorod, was much better understood as a criminal activity by groups and gangs which had appropriated the political symbols of Pravy Sektor.

I found, driving the length and breadth of Zakarpatska, and I drove in from Ivano-Frankivsk and then followed the Tisza River along the Romanian border and drove all the way to Mukacheve and then Uzhgorod. I found no evidence of separatism. What I found was a region that is looking for unity with Ukraine and is looking to take part in the process of national transformation that the government in Kyiv has begun.

Zakarpatska, because of its geography with a border on four EU member states, has enormous potential to be a driver of Ukraine's economic relationship with Europe. I was impressed to visit with an American technology company called Jabil which produces advanced electronics. Their whole business model hinges on the fact that they are a three hour drive from Budapest and they are producing high technology products using skilled Ukrainian workers for the entire European market. That's the kind of thing that Zakarpatska is well positioned to do much more of, and I think the United States has confidence that Governor Moskal is focused on exactly the same priority.

But as far as I can tell, the phenomenon of separatism in Transcarpathia is a product of Russian propaganda and the imaginations of producers at Russia Today.

Ambassador Tombiński: Let me join Ambassador Pyatt in this political description of the landscape. We've measured how popular the far right might be throughout elections have been organized last year, and the potential of parties, of leaders of this party is probably to mobilize up to two percent population for combined different parties and movements from what we call far right or nationalistic movements. So we should not over-exaggerate this phenomenon, although we should not neglect it and neglect the need of action of state structures to reinstall the monopoly for use of arms and for all sanctions related with the establishment of law and order by authorized state structures.

This event that happened in Mukacheve illustrates certain weaknesses of this country and the weaknesses of structures in charge of assuring the security. It is well illustrated how much these different groups are intertwined with criminal smuggling operations.

I draw from it also one additional comment and lesson. Smuggling needs two partners. If it is so highlighted in this region of Zakarpatska and Governor Moskal and other people who are in charge of the region are now unveiling more and more facts about smuggling and even specializations on different border checking points for different kind of goods to be smuggled. This is also that we have to signal to our EU partners on the other side of the border because for smuggling you need a supplier and a receiver of it. So it is also something that my colleagues in different European bordering countries have to take seriously into account and try to remedy it.

The issue of the capacity of the government to carry out reforms is a determination, is a clear result to what has been already said on the address of different, non-governmental organizations, civil society in defending the country. This is true for non-governmental organizations and civil society in pushing for reforms. The civil society is perhaps one of the not yet well integrated in the general picture of Ukraine phenomenon. But we have dozens, a full planet of those who are engaging in talking, working, proposing for the future of the country, a solution for the future of the country. This is a huge strength behind the administration. Although very often we see weaknesses in the administration. There was no change of whole state apparatus after the change that we observed since March last year, so the big issue is how to change the country with a big part of people who still are children and products of the past system. The European Union puts a lot of emphasis on reform of public administration, of civil service, in order to have tools, how to implement laws. On the level of top political elite of Ukraine we have all understanding for what is to be done but then the devil lies with the implementation. And for the implementation we try to help Ukraine in finding new people who are not mentally formed during the past period where absence of action was the model, and not taking risks and implementing the laws.

So a result on the top level, yes. We have now to build bottom up new layers of administration in order to help Ukraine implement the laws.

Moderator: Thank you.

For our next question, we've got a few journalists who have come together to listen to this call in Bratislava, so we're going to go over to Embassy Bratislava and take a question, one question from Pravda. Go ahead, Andrej.

Pravda: Good morning, my name is Andrej Matisak. I'm from Daily Pravda, Slovakia.

My one question for Ambassador Tombiński. Mr. Ambassador, have you had any discussion with Ukraine about the letter Ukraine has sent regarding big reverse gas flow from Slovakia? Ukraine has sent this letter to the European Commission and Ukraine claims that Slovakia is breaching EU legislation by not allowing the big reverse gas flow. So have you had any discussion with Ukraine? Because Slovakia was quite furious about this letter as we are giving Ukraine a small reverse gas flow.

And one question for Ambassador Pyatt. So with the Iran deal, do you think there is a chance to open some new diplomatic channels with Russia regarding Ukraine? Thank you.

Ambassador Tombiński: Gas talks are mostly commercial ones between operators with the Vice President of the European Commission, by the way, a Slovak member of the European Commission, Maros Sefcovic, being the pivotal person in trying to assure that the new binding agreement between Naftogaz and Gazprom is signed as between commercial entities. The big question for Ukraine is to liberate Ukraine from the dependency on Russian gas and dependency on political decisions with regard to supplies, volumes, pricing, entry points and all conditionality for gas supply.

The reverse works for modern [inaudible] and it has been treated as big reverse gas flows allowing for transporting through the Slovakia grid of pipelines more than ten billion cubic meters a year to Ukraine. However, due to the fact that there were, for a certain period until the end of June, shipments from Russia to Ukraine, this capacity of gas flow from Slovakia hasn't been used in full extent because it was not much needed. If Russia stops supplying Ukraine from the first of July, in absence of an agreement the European Commission and Ukraine so much wished in the last days of June, now Ukraine is calling for more volume to be shipped from Slovakia to Ukraine in order to fill the gas storages.

I've seen on my way to this meeting that there will be an increase in daily shipments from the first of August, which I guess is partially the answer to this demand in order to assure that it's enough volume of gas stored before the winter season comes and in order to avoid a major crisis.

So this goes mostly between operators and the European Commission level, who is in charge of talks between operators with involvement in the European Commission, set response to the demand of both governments. The European Commission has been asked to engage in these talks already a year ago with Commissioner Ettinger, and now Commissioner Sefcovic has taken the lead.

So I did not see on my level major complaints about how it goes.

Ambassador Pyatt: Just to jump on Ambassador Tombiński's question first. If you look on my Twitter you will see that last week when I was in Uzhgorod I actually went to the border gas transmission station with Slovakia and was able to feel the gas moving through the reverse flow pipeline. I was there joined by Mr. Kobolev, the CEO of Naftogaz. All I heard was deep appreciation for the cooperation and partnership with the Slovak government. I know that Prime Minister Yatsenyuk places high priority on his partnership with his counterpart in Bratislava and the work that the two governments have done together to make this reverse flow channel so effective.

So I have exactly the same impression as Ambassador Tombiński and as I said, I tested it on the real world level last week.

On Iran, it's very simple. There is zero linkage between our policy in Iran and our policy in Ukraine. Russia acted in its own self-interest to cooperate with us in striking a very important agreement on the Iran matter. In Ukraine we continue to have profound differences over Russia's continued violation of Ukraine's territorial integrity. And under no circumstances are we going to dilute those concerns in furtherance of some unrelated policy issue.

Moderator: Thank you. I believe we only have time for one last question and that question is coming to us from Poland. We have on the line Jedrzej Bielecki from Rzeczpospolita.

Rzeczpospolita: Good morning. Jedrzej Bielecki from Rzeczpospolita, Polish daily. I have two questions.

One concerning the military situation in the eastern part of Ukraine. How big is the risk that there will be a new offensive from Russia maybe towards the strategic port of Mariupol? According to U.S. sources as I understand, there are at least 9,000 Russian soldiers there already with heavy equipment. So maybe they will use this holiday period in August to start this.

The second question concerns the economic situation of Ukraine and the risk of bankruptcy. Because as I understand, the GDP of Ukraine is going down very quickly, maybe by ten percent this year. On the other side there is still no agreement after many many months of negotiations with creditors, especially American ones, like the Franklin Templeton Fund. So is this a real risk, the bankruptcy of Ukraine?

Thank you so much.

Ambassador Tombiński: I visited Mariupol exactly two months ago and talked to people, walked through the streets, and looked at the city through the eyes of citizens. This is a huge psychological burden on the city since it might be a target of military affiliations that no one wishes.

This is a more than 400,000 inhabitant city. This is not a small village. And this city is a big city on the Ukrainian territory and has shown already quite a high level of determination in defending itself.

What are the risks for the other side? I don't have access to inside information on the other side. But we have seen that since September 19 last year, the Minsk declarations about the so-called Line of Contact, the separatists backed by Russia have won more than 580 square kilometers on the Ukrainian territory, more to what already has been taken in parts of Donetsk and Luhansk regions. So it is also very much to imagine where we are with the fulfillment of obligation in bringing about a peace solution. Any further military move should be considered as a dramatic breach of all obligations to deliver in order the political solution to the crisis and that we try to return a normal peaceful life to this area.

Ambassador Pyatt: Let me start, since Ambassador Tombiński is too modest and too much of a good European official to single it out, by saying how impressive Poland's leadership in Ukraine has been. Poland is a critical partner for the Ukrainian people and also of course for the United States. It is probably the single most important model of successful economic and governance reform, and it demonstrates that it's possible.

I will always think back two years ago to President Kaczyński at the last Yalta Conference in Yalta declaring the importance of Ukraine sticking to its European path and not being derailed by the obstacles that the Kremlin was trying to place in its way. So Poland has been a critically important partner across the full spectrum of defense and economic reform issues. Poland was represented by your Defense Minister at the Rapid Trident Exercise on Friday, and I must say I was very impressed by how strong and capable the Polish forces that I saw out on the exercise field appeared.

On your question of separatist and Russian intentions, I have long ago sworn off making any predictions because the Kremlin's behavior has been so unpredictable and irresponsible.

In this regard it's important not just to focus on one town, Mariupol. As I noted in my opening remarks, the violence, the effort to grab territory that Ambassador Tombiński referred to has occurred all up and down 180 degrees of the Contact Line. From Schastye and the Russian border in Luhansk all the way down to Mariupol. And everything that we see including hybrid separatist Russian exercises, equipping, training, suggests that the Kremlin and its proxies are maintaining the capability to continue seeking to grab territory at a time and place of the Kremlin's choosing. That is why it is so important that we stay united on our principles.

And on your question about the financial situation, I would just underline here the very important legislation that the Rada passed about a week and a half ago. The importance of strong, positive signals from the IMF including the IMF's announcement of a board meeting later this week to approve the release of the next tranche of budgetary support.

I do not believe that the difficult negotiations with the private bond holders are going to derail Ukraine's further economic progress. I think there is a sense of confidence now among Ukrainian economic decision-makers that they can, that the worst is past and that they can manage a process of sustainable reform and macro financial recovery.

I know you said last question but my team tells me the next question is from a German journalist, and I must say given the central importance of Chancellor Merkel here, I would be happy to take that question as well.

Moderator: Great. Thank you so much for that.

So our next question is actually coming to us from Thomas Nehls of WDR Radio in Germany.

WDR: Hello. I just have a brief question coming back to the Munich Security Conference which I attended and witnessed Senator McCain demand German support for heavy weapons delivery to the Ukraine. Is that dispute over between America and some of the other NATO countries, Ambassador Pyatt? Or is it still going on a little bit covered maybe?

Ambassador Tombiński: If I may jump one step back, because this question about possible bankruptcy of the country, default of the country should be repeated more in detail. Joining what Ambassador Pyatt has said about this result action of the government and the Rada to adopt all needed legislation in order to introduce more transparency to the public finance management, to stick to sustainability of the budget revenues and spendings in the mid- and long-term goal.

We also have to go to certain details. The coupons for the debtors have been paid off some days ago, so it's not -- There was a lot of speculation that Ukraine will not pay back $120 million to cover its obligation. It hasn't been paid.

European Union, knowing how these negotiations will go, decided to step in with further financial, macro financial, assistance. We disbursed to the Ukrainian budget 600 million euro last Wednesday.

On top of it the IMF on the level of the board also approved disbursement of a further tranche to the Ukrainian budget in the amount of 1.3 billion U.S. dollars, which is all done with the sense that commitments, engagements, and resolute action of the government and Rada should be supported by our financial assistance in order to bridge the most dramatic short-term period as the country is under such economical strains and also under the pressure of financing military expenses, which is a huge burden on the state budget, and security goes first.

Ambassador Pyatt: Thomas, on your question about Munich, let me just say I was at the Munich Security Conference also. I was part of President Poroshenko's meetings with Vice President Biden and other U.S. officials, also his meetings with Senator McCain's delegation. I must say I have a different sense of where we are. There is no daylight between the United States and Germany in terms of our shared objectives in Ukraine. Ambassador Tombiński and I think it's fair to say we both coordinate with Ambassador Weil about as much as we coordinate with any of our other counterparts.

I was in Berlin in April for consultations with Ambassador Emerson but also with the chancellery and with Foreign Ministry counterparts. We, the United States, have deep appreciation for the exceptional leadership that Chancellor Merkel and the German government has played throughout this crisis, including that exceptional ten days that the Chancellor spent flying between Berlin and Kyiv and Minsk and Washington. It was a remarkable demonstration of German diplomatic leadership but also political courage on behalf of the Chancellor.

What we all want to see is the same. What we want to see Minsk implemented. That requires among other things the withdrawal of Russian troops and equipment, the release of all hostages including Nadia Savchenko, the restoration of Ukrainian control over the international border. These are all steps that are laid out in great detail in the Minsk Agreement and have not yet been accomplished.

So I think it is appropriate between allies like the United States and Germany that we have frank conversations about how best to pursue our shared objectives, but I see absolutely no difference between our objectives, and I see a very healthy and constructive dialogue between Washington and Berlin that I've been proud to play my own small part of here on the ground in Ukraine.

And I would also note in this regard, when I meet with President Poroshenko or Prime Minister Yatsenyuk, there is nothing more important to Ukrainian leaders than unity between Europe and the United States.

Ambassador Tombiński: Thank you. If I may in this concluding mode stress also the exemplary cooperation that we have here with Ambassador Pyatt, because this is our common obligation to assure peace and to see stability and observation of all international obligations including the question of Crimea as well as the military aggression against Ukraine. This is also the basis for European policy as it is enshrined in European decisions of the European Council and other European bodies.

One element to add to the understanding of Minsk. Minsk, February 12 Declaration, is aimed to support the peace plan of President Poroshenko as it has been tabled at the beginning of July 2014. And this, what has been written in Minsk in February should be seen in a context of previous two Minsk agreements on the 5th and 19th of September last year, that the security points are always first and it is not by pure chance that questions related to ceasefire, withdrawal of arms, withdrawal of mercenaries go first because they are a prerequisite for political dialogue, for a possibility to allow for elections that would allow to emerge leaders in the region with a mandate, not only leaders with a weapon. This is the main purpose of the exercise. Thank you.

Moderator: With that, I would like to sincerely thank you Ambassador Tombiński and Ambassador Pyatt. We really appreciate you taking the time to join this call today. And I'd like to thank all of our participants from around Europe who have dialed in, and thank you for your questions.

We are going to prepare a transcript of today's call, and we will send it to you as soon as it is ready, and a digital recording is going to be available through AT&T for the next 24 hours.

With that, I will say goodbye and I will turn it back over to AT&T to give you those instructions. Thanks so much.

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