Kerry warns Putin on Ukraine as Russia opens troop drills

Bloomberg

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A member of the Ukrainian special forces takes position at an abandoned roadblock in Slovyansk, Ukraine, on April 24, 2014.

U.S. Secretary of State John Kerry warned that Russia is running out of time to comply with an accord to ease tensions in Ukraine, as Russian forces began new military exercises on the two countries’ border.
Speaking in Washington, Kerry accused Russia of using the “barrel of a gun and the force of a mob” to impose its will on Ukraine. He said Russia has failed to live up to commitments it made a week ago in Geneva to de-escalate the situation and said continued lack of cooperation would bring consequences.
“If Russia continues in this direction, it will not just be a grave mistake, it will be an expensive mistake,” Kerry said at the State Department. Earlier yesterday, President Barack Obama said the U.S. and its allies are ready to impose further sanctions on Russia if it doesn’t back off.
Kerry spoke hours after Russian President Vladimir Putin warned Ukraine against continuing an anti-separatist offensive that killed five rebels. The agreement on disarming rebels and other measures signed April 17 in Geneva by Ukraine, Russia, the European Union and the U.S. is on the brink of collapse.
While Kerry declared that Russia has “refused to take a single concrete step” toward implementing the agreement, his words reflected the limited U.S. ability to influence Putin’s actions in a region that’s long been under Russia’s economic and political sway.
Response faulted
“This is not much of a response,” said Angela Stent, director of the Center for Eurasian, Russian and East European Studies at Georgetown University in Washington, noting Kerry didn’t announce implementation of the threatened sanctions.
“The administration didn’t think Ukraine was going to define the latter part of their foreign policy,” Stent said in a telephone interview. “There seems to be no strategy here.”
Kerry said Russia’s economy is already hurting as a result of $70 billion in capital outflows during the first quarter of this year. Growth estimates have been revised downward by 2 to 3 percentage points, and the Russian Central Bank has had to spend more than $20 billion to defend the ruble, he said.
With tensions high, Russia’s Micex Index (INDEXCF) fell for a fourth day yesterday, losing 2.2 percent and taking its decline since Putin’s intervention in Crimea started March 1 to 10 percent.
After rallying on the prospect of an International Monetary Fund loan, Ukrainian bonds fell. The Washington-based lender’s staff endorsed a $17 billion bailout that may get board approval April 30, according to government officials. The yield on the government’s dollar-denominated note due in April 2023 rose 0.03 percentage point to a month-high 10.09 percent.
Military maneuvers
In Ukraine, Interior Ministry and army troops destroyed three road blocks as they fought pro-Russian separatists in the Donetsk region city of Slovyansk, the ministry said yesterday on its website. Russia’s latest military maneuvers are a response to events in eastern Ukraine and involve warplanes near the border, Russian Defense Minister Sergei Shoigu said, according to the Interfax news agency.
“If it’s true that the current regime in Kiev sent the army against citizens inside its country, then it is a very serious crime against its own nation,” Putin said yesterday in St. Petersburg.
Russian Senator Valeri Shnyakin, a member of the defense and security committee, called for the government to send peacekeepers to southeast Ukraine and said lawmakers were working on a proposal to be voted on April 29. In an interview with Izvestia, he said they may submit their plan sooner “if the situation deteriorates further.”
Putin’s ‘fantasy’
In his statement, Kerry reiterated other U.S. officials’ contentions that Russia is using its special forces and intelligence service, saying evidence contradicts Putin’s “fantasy” about who’s responsible for the violence in eastern Ukraine ahead of presidential elections planned for May 25.
“Our intelligence community tells me that Russia’s intelligence and military intelligence services and special operators are playing an active role in destabilizing eastern Ukraine with personnel, weapons, money, operational planning and coordination,” Kerry said.
“This is a full-throated effort to actively sabotage the democratic process through gross external intimidation,” Kerry said.
Putin’s actions have caused alarm among other nations in central and eastern Europe, including those such as Poland that -- unlike Ukraine -- are part of the North Atlantic Treaty Organization mutual defense umbrella.
Russian threats
Ukraine is “at risk of a foreign invasion, or a civil war, or both at the same time,” Czech President Milos Zeman said yesterday at a meeting of east European leaders in Prague. “The older among us experienced something similar about 20 years ago in Yugoslavia.”
“Russia has switched from public threats to concentrating its forces on our eastern border,” acting Ukrainian president Oleksandr Turchynov said yesterday. “There’s an increasing number of troops, who’ve been threatening our country for some time.”
An attack on a Russian citizen is an attack against Russia and “if we’re attacked, we’d certainly respond,” Russian Foreign Minister Sergei Lavrov said April 23 in an interview with state-run broadcaster RT. Speaking in Moscow yesterday, he called on Ukraine to pull back its army, stop “illegal actions” and disarm the nationalist Pravyi Sektor group.
Turning up the economic heat on Ukraine, Russia’s state-run OAO Gazprom (GAZP) presented the nation with an additional $11.4 billion bill for gas it promised to buy last year.
‘Legitimate actions’
The U.S. has been preparing for the prospect of further sanctions against Russia, Obama said yesterday. All that’s required is some “technical work” and coordination with allies, he told a news conference in Tokyo.
The U.S. joined the EU in imposing sanctions after Russia annexed Crimea from Ukraine last month.
French President Francois Hollande told reporters in Paris that unless the Geneva deal was implemented fully, “we would by necessity have to apply the sanctions as planned by Europe.”
The EU didn’t criticize Ukraine’s Slovyansk operation. While calling on “all parties” to live up to the Geneva pledges, EU spokesman Michael Mann told reporters in Brussels that the Kiev government has the “right to take legitimate actions to defend its sovereignty and territorial integrity.”
While the U.S. administration has threatened to bring more sanctions against Russia, Kerry avoided mentioning any specific further steps the U.S. would take and wouldn’t take questions after his remarks.
“He left the ‘what does it mean that we’re prepared to act?’ out of all this,” said Samuel Charap, a senior fellow for Russia and Eurasia at the International Institute for Strategic Studies in Washington. “If they don’t comply, what are we going to do about it?”

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