Can Kiev make face to mounting economic problems and social unrest?

Federica Mogherini, High Representative of the Union for Foreign Affairs and Security Policy and Vice-President of the EC, went to Kiev where she met with Petro Poroshenko, President of Ukraine. (On the left side) Petro Poroshenko, in the centre, and Pavlo Klimkin, Ukrainian Minister for Foreign Affairs, on the left. (On the right side) Federica Mogherini, in the centre, and Jan Tombiński, Head of the Delegation of the EU to Ukraine, on the left. (EC Audio-visual Services, 16/12/2014).

Federica Mogherini, High Representative of the Union for Foreign Affairs and Security Policy and Vice-President of the EC, went to Kiev where she met with Petro Poroshenko, President of Ukraine. (On the left side) Petro Poroshenko, in the centre, and Pavlo Klimkin, Ukrainian Minister for Foreign Affairs, on the left. (On the right side) Federica Mogherini, in the centre, and Jan Tombiński, Head of the Delegation of the EU to Ukraine, on the left. (EC Audio-visual Services, 16/12/2014).

The time of truth for the European Union’s strategy on the Ukrainian question finally came. Brussels is about to let the poor country not only be dismembered, but what will be left of it will be pushed into an economic and political inferno. As it happens, Commission President Jean-Claude Juncker essentially ‘ordered’ Kiev to “bring peace to Donetsk and Lugansk”, knowing that the only way the Ukrainian government can achieve this, is to accept the separatists’ demands for autonomy.

Then, Juncker asked the new administration to correct the country’s deeply rooted macroeconomic and structural problems, recognising at the same time that despite the fact, “Ukraine will need USD 15 billion in addition to what is already planned. The EU can only help within its budget”. This plainly means that the EU simply cannot afford that kind of money, while the US has made clear that it’s Europe’s responsibility to economically support Ukraine. Let’s take a closer look.

Ukraine out in the cold

As a result Ukraine will be left out in the cold. Without all those billions, Kiev cannot subsidise the household and business natural gas bills, because Russia stopped to subsidise them herself. Moscow now sells its fuel to the ex-protégé more expensively at costs close to market prices but still Kiev cannot afford it without the West’s help. The interim solution agreed for this winter has cost dearly to the EU and cannot serve as a long-term arrangement. Juncker clarified that also. Add to that the lack of the needed financing to avoid mass layoffs and disintegration in the government sector, Ukraine’s social structures and state services would be soon dismantled.

There is no need to go through the EU-Ukraine relations history. It’s very well-known to be repeated. Brussels and the other major EU capitals supported, if not stirred up, the pro-western insurrection of various groups that ended up in the Kiev Maidan revolution. Now the country is definitively divided in the pro-western part under the Kiev government and the eastern region under the spell of Moscow.

Definitely estranged with Russia

The above mentioned Juncker quote is a direct recognition of this division. Of course the West doesn’t officially accept the annexation of Crimea by Russia nor does it consent to a full self-rule for Donetsk and Lugansk. If it did this would have amounted to a free gift to Vladimir Putin, the autocratic ruler of Kremlin. Understandably, the West saves this concession to be traded with Moscow.

The definite detachment of Kiev from Moscow leaves it out in the cold, at least energy and trade wise. Kiev is to lose billions from the hostilities with Russia, relating to the energy and trade sectors. If you add to that the costs to correct the structural distortions of an economy politically and fraudulently managed, the needs of Kiev amount to so many billions, that the West is unwilling and rather unable to provide. Instead, Brussels offers advice and a completely inadequate economic backing, compared to the immediate needs of Ukraine.

In need of billions and offered millions

On 3 December the EU disbursed €500 million. This was the second and final loan tranche of the EU’s €1 billion Macro-Financial Assistance (MFA II) programme for Ukraine, approved earlier in 2013. According to Juncker, prior to the 3 December disbursement, three transfers under this instrument were made earlier in 2013: “€100 million on 20 May, €500 million on 17 June and €260 million on 12 November. The final disbursement of €250 million is expected to be made by spring 2015, provided that Ukraine shows satisfactory progress with the accompanying reforms”. It’s as if the EU wants to buy Ukraine cheaply and by instalments.

There is no doubt that Kiev apart from its military difficulties in the east, it already encounters grave social problems in the heart of the country. The Brussels instructions to restructure the economy and reform the state machine to make the package more efficient and able to stand on its own feet, cannot be undertaken on the cheap nor can it be accomplished easily. Not without a deep incision on the Ukrainian society and major social unrest.

Then how is the Ukrainian government to encounter the multiple economic problems and the social turbulences that go along? Probably Kiev and Brussels have in mind to employ the services of the armed right-wing groups to suppress the social discontent which is already visible and surely bound to grow further. Of course, such an undemocratic prospect would not bother Moscow, for as long as Donetsk and Lugansk remain under her spell. This is probably the base of the recently restored warmer winter climate between Russia and the EU.

the sting Milestones

Featured Stings

Can we feed everyone without unleashing disaster? Read on

These campaigners want to give a quarter of the UK back to nature

How to build a more resilient and inclusive global system

Stopping antimicrobial resistance would cost just USD 2 per person a year

UN health agency highlights lifestyle choices that can prevent onset of dementia, as millions more succumb each year

Ukraine-EU deal sees the light but there’s no defeat for Russia

Baking The Galette-des-rois Of Egalitarianism

These are the world’s best universities for recycling and sustainability

Time to measure up: 5 ways the fashion industry can be made more sustainable

IMF’s Lagarde: Estimating Cyber Risk for the Financial Sector

Antitrust: Commission accepts commitments by Transgaz to facilitate natural gas exports from Romania

EU Budget 2019 to focus on young people

How the world can ‘reset’ itself after COVID-19 – according to these experts

Coronavirus: rescEU medical materials dispatched to Serbia

State aid: Commission invites interested parties to provide comments on proposed draft Climate, Energy and Environmental State aid Guidelines

MEPs call for decisive action to fight inequalities in the EU

Emergency coronavirus research: Commission selects 18th project to develop rapid diagnostics

Safer products: stepping up checks and inspections to protect consumers

Humanitarian action: New outlook for EU’s global aid delivery challenged by COVID-19

Professional practices of primary health care for Brazilian health and gender inequality

Here’s how one business leader is tackling injustice: It starts with personal commitment

MEPs agree on new rules to tax digital companies’ revenues

More countries are making progress on corruption – but there’s much to be done, says a new report

EU Parliament: The surplus countries must support growth

Commission launches the Fit for Future Platform and invites experts to join

The punishment gap: how workplace mistakes hurt women and minorities most

12 ways a human-centric approach to data can improve the world

The online junk information grows, but so we shall

NextGenerationEU: Commission presents next steps for €672.5 billion Recovery and Resilience Facility in 2021 Annual Sustainable Growth Strategy

UN envoy says he ‘is ready to go to Idlib’ to help ensure civilian safety amid rising fears of government offensive

How do we upskill a billion people by 2030? Leadership and collaboration will be key

Europe fit for the Digital Age: Commission proposes new rules for digital platforms

Coronavirus: EU makes available additional humanitarian funding of €41 million to fight the pandemic

Feeding a city from the world’s largest rooftop greenhouse

Autonomous vehicles could clog city centres: a lesson from Boston

Geographical Indications – a European treasure worth €75 billion

This new initiative aims to make cybercrime harder – and riskier – to commit

Children in crisis-torn eastern Ukraine ‘too terrified to learn’ amid spike in attacks on schools

UN welcomes Angola’s repeal of anti-gay law, and ban on discrimination based on sexual orientation

Solutions for cultural understanding: medical students’ perspective

Cape Town’s crisis shows us the real cost of water

UN Human Rights Council stands firm on LGBTI violence, Syria detainees and Philippines ‘war on drugs’

Here’s what could happen to the global economy this year

Our food system is pushing nature to the brink. Here’s what we need to do

Parliament wants binding rules on common chargers to be tabled by summer

Guatemala Dos Erres massacre conviction welcomed by UN human rights office

Expanding the care for the quality of life and quality of death

Sanctions: Commission further expands Guidance on COVID-19-related humanitarian aid in sanctioned environments

Building cybersecurity capacity through benchmarking: the Global Cybersecurity Index

A short history of climate change and the UN Security Council

How rescheduling debt for climate and nature goals could unlock a sustainable recovery

This app lets you plant trees to fight deforestation

Explained, the economic ties between Europe and Asia

EU Budget 2021 deal: supporting the recovery

Pandemic mental health: the urgency of self-care

State aid: Commission approves €1.25 billion German measure to recapitalise TUI

State aid: Commission approves €511 million Italian scheme to compensate commercial rail passenger operators for damages suffered due to coronavirus outbreak

MEPs adopt greener funds for regional development and cooperation

Data is the oil of the digital world. What if tech giants had to buy it from us?

Coronavirus: First case confirmed in Gulf region, more than 6,000 worldwide

The latest emoji are more inclusive – but who approves them?

G7 Summit: President von der Leyen outlines key EU priorities

Iran: UN rights chief ‘deeply disturbed’ by continuing executions of juvenile offenders

Fighting cybercrime – what happens to the law when the law cannot be enforced?

More Stings?

Speak your Mind Here

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s