Ukraine: Where Will it End? Part III

Ukraine: Where Will it End? Part III

In June 2014, Poroshenko signed the association agreement with the EU that Yanukovych had rejected, including a free trade agreement. The agreement contains enormous reform demands and thus puts strong pressure on the Ukrainian authorities, which since independence in 1991 have struggled with, among other things, widespread corruption and weak institutions – government agencies that function poorly. So far, previous government changes – such as after the Orange Revolution in 2004, and the election of Yanukovych in 2010 – have not led to the necessary changes. Among other things, this has contributed to a miserable investment climate . The lack of changes after 2004 probably also contributed to people being so steadfast in 2014 – now the demonstrations were to take place.

In addition, in April 2014, the Ukrainian authorities signed a $ 17 billion rescue package with the International Monetary Fund (IMF). The rescue package means that Ukraine has had to initiate extensive austerity measures . The cuts will be particularly large in the public sector. Up to 10 percent of employees will lose their jobs there. So far, there have been few protests against the austerity measures. Nevertheless, it is conceivable that the economic situation and the forthcoming reforms will intensify dissatisfaction among the people.

6: Ukraine – Russia and the international community

President Poroshenko announced in November 2014 that the government would hold a referendum on NATO membership . In December, the Ukrainian parliament Rada repealed a 2010 decision that the country should not be part of any bloc. NATO membership was now defined as a national goal . Russia, for its part, wants a guarantee that Ukraine will not become a NATO member. NATO’s enlargements to the east have strongly provoked the Russian authorities. Among other things, they believe that the enlargements are a breach of promises made during the negotiations on German reunification in 1990. NATO refers to that no formal promise was made, that the enlargements are intended to “promote stability and cooperation” and that they do not pose a threat to Russia. Ukraine, for its part, points out that the Russian annexation of Crimea is a violation of the so-called Budapest Treaty of 1994 . There, Ukraine was promised territorial integrity in exchange for getting rid of all nuclear weapons. Soviet nuclear weapons were deployed in four of the sub-republics. Both Ukraine, Kazakhstan and Belarus renounced possession of nuclear weapons after the dissolution of the Soviet Union.

According to Ehotelat, NATO membership for Ukraine is unlikely to be relevant in the near future. Then there may be unanimity among NATO countries to send such an invitation. It does not, among other things, Germany and France will most likely strongly oppose it. The same skepticism applies to EU membership. Russian authorities also point to Ukrainian economic dependence on Russia. The EU cannot get around this.

The main consequences outside Ukraine are related to Western reactions to what is perceived as Russian military intervention in eastern Ukraine, in addition to the annexation of Crimea. Fears are widespread that Russia will use the same tactics in other post-Soviet countries with Russian-speaking minorities. This is especially true in the Baltic states, which since independence have had an ongoing conflict with the Russian government over the treatment of the Russian minority in each of the Baltic countries. Poland has taken the lead in pursuing a more offensive Eastern European policy towards Russia. NATO, for its part, has launched Operation Atlantic Resolve in connection with the Ukraine crisis. The stated intention is to “deter Russian regional hegemony”. This means i.a. the creation of a new rapid reaction force of 5,000 soldiers . Norway is one of the member countries that will participate with forces.

Russia’s economic situation has deteriorated dramatically over the past year. This is partly due to sanctions and falling oil prices. Partly – and more fundamentally – the deterioration is also due to structural problems that the government has not yet tackled. Over the past year, the ruble has lost 40 percent of its value. The value of Russia’s exports in dollars has fallen by 20 percent, so even though Russia now produces more than it did in 2013, they earn less. Many interpret it as Western sanctions only hastening a situation that sooner or later may come. Investors are scared and leave the country. However, Putin’s popularity in December 2014 was around 80 percent. The sanctions are largely perceived as the West looking to “take them”. The frustration is therefore directed primarily at the US and the EU rather than the government.

One year after Yanukovych was ousted from power, the situation does not look very bright. The latest attempt to resolve the crisis has come in the form of the so-called “Normandy group”, which consists of Ukraine, Russia, France and Germany. France and Germany are also skeptical of the current sanctions, and French President Hollande has recently stated that Russia’s position in eastern Ukraine is misunderstood. Whether they will succeed in finding a solution also depends on the interests of the rebel groups. Regardless of how we interpret Russian influence, there are many indications that they do not have the necessary control to order the rebel groups to do what they are supposed to do. Both Russia and Ukraine thus face a political and economic situation in 2015 that will be difficult to resolve with simple measures.

Ukraine Country 3