The VoxUkraine Brief:
Who Is The Winner In New Ukraine Peace Deal
#VoxUkraine weekly selection of best articles on Ukraine.
by Yuriy Gorodnichenko and Ilona Sologoub, VoxUkraine Editorial Board
produced by Maxim Eristavi
The most important event of this week was of course the peace talks in Minsk that lasted for over 16 hours.
As The Economist notes (and many Ukrainian observers agree with this view), Russian President Putin may feel like a winner in these talks: he keeps control over a part of the Russian-Ukrainian border, and proxy states created by him in the eastern part of Ukraine are likely to gain some legitimacy if local elections are indeed held there.
The Economist also argues that instead of supplying weapons to Ukraine, which will escalate the conflict, the West should focus on further sanctions on Russia (including much broader visa bans) and helping Ukraine and other ex-Soviet states with security and economic development issues.
A similar tone was taken by The New York Times editorial which admitted that the second Minsk agreement was a “bitter pill” for Ukrainian President Poroshenko but he needed to take it under pressure from German Chancellor Merkel and French President Hollande. The editorial also argues that “Mr. Putin have been offered a much better deal than he deserves” and that there should be no lifting of sanctions, and further tightening of sanctions if Russia fails to live up to the terms of agreement.
The Washington Post editorial on the same issue has taken a much harder stance. The WP editors actually view it as a defeat of Ukraine and Western diplomacy. They argue that:
“The result of the all-night negotiations in Minsk […] reflected the imbalance between a Kremlin ruler in the midst of using military force and European leaders who not only are unready to respond but who are also trying to prevent Ukraine from obtaining the means to defend itself. In exchange for the promise of a “deescalation” that was their overriding goal, the European leaders induced Mr. Poroshenko to accept terms that give Mr. Putin a veto over any final political settlement in eastern Ukraine — and permission to continue violating the country’s sovereignty in the meantime.”
Analyzing the agreement signed, Edward W. Walker claims that it’s quite vaguely written, and overall only four of eleven provisions of the document have a “meaningful chance of being implemented”. These are “Provision 1, which calls for a ceasefire; Provision 2, which provides for a separation of forces; Provision 3, on monitoring of force dispositions by the OSCE; and Provision 6, which provides for a full exchange of prisoners”. Further analyzing provisions 1 and 2, the author argues that they are very general which means that “the devil is in the details”. In sum, even if the heavy arms are withdrawn from the “contact line”, the ceasefire, if there is any, will be very fragile.
Another significant result of this week was signing of the new IMF program for Ukraine, which The Economist calls “an austerity program”. However, perhaps, taking into account the corruption track record of Ukrainian government, it should not be provided with plenty of money, and the money provision should be conditional on specific reform actions.
The question of “arm or not to arm” Ukraine was one of the main issues in the Munich conference discussion last week. Ann Applebaum in her reflections on the results of the summit suggests that the agenda of West-Ukraine relations should be much broader than this. The West should have a long-term strategy of pulling Ukraine out of the Russia’s jaws into the civilized world. This includes much broader economic sanctions than now (in particular, turning off SWIFT for Russian banks). EU producers and bankers will have to bear some cost. But the cost of surrendering Ukraine to Russia will be much higher.
VoxUkraine’s Yuriy Gorodnichenko argues that amid discussions whether to supply weapons to Ukraine or not the world should not forget that the key Ukrainian problem is economic crisis, and Ukraine needs an immediate help to deal with it. A new program with the IMF (worth $17.5 billion in additional loans to Ukraine) was signed on February 12th and should help alleviate some of the immediate fiscal and foreign exchange pressures on Ukraine.
At the end of the last week the Ukrainian central bank (NBU) decided to shift its exchange rate policy towards free float and cancelled the indicative exchange rate, which resulted in a steep hryvnia devaluation. Editorial board of VoxUkraine argues that while the policy step to have a single exchange rate is right, its timing was ill-chosen. Perhaps, new loans from the IMF can tame the panic in the foreign exchange markets.
Michael Gentile in his VoxUkraine op-ed takes a broader view on the Donbas conflict — it is not only Ukraine-Russia war but a war of Ukraine with its Soviet past. He states that:
“rather than being divided between Ukrainians and Russians, the Donbas is divided between people who believe in the concept of Ukrainian sovereign statehood and those who are nostalgic of the Soviet past.”
A recently unfolded discussion of the gas tariff hike created tensions in the Ukrainian society and expert environment. VoxUkraine summarizes the pros and cons of this step and, admitting that it is inevitable, advises accompanying reforms in the energy sector.
Also, this week on #VoxUkraine
War and Freedom of Speech in Ukraine
While most people think that freedom of speech is a great good in a democratic society, there is much more disagreement on how much one should be allowed to say in times of war. The recent detainment of journalist Kotsaba — he declares that the war in eastern Ukraine is a civil war and calls for sabotaging draft into the Ukrainian army — underscores the importance of this debate in the current Ukrainian context. An open discussion about what constitutes treason when it comes to expression of views will protect the new but fragile Ukrainian democracy. It will also defend Ukraine against accusations that the country is turning into a police state.
http://voxukraine.org/2015/02/12/war-and-freedom-of-speech-in-ukraine/
Restructuring Ukraine’s Electricity Sector: What Are We Trying to Accomplish?
The Ukrainian electricity sector will require a great deal of investment if it is to support robust national economic growth going forward, writes Russell Pittman, a U.S. government economist and a visiting professor at the New Economic School (Moscow) in his VoxUkraine op-ed. Many of the generation plants and a great deal of the long-distance transmission infrastructure are badly depreciated and quite inefficient; this is one reason that the Ukrainian economy is one of the most energy-intensive (per volume of output) in the world.
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Have a great weekend!
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