Reuters blog archive
Vladimir Putin said this morning Russia and the United States are still far apart over Ukraine. Moscow, he said, could not ignore “illegitimate decisions” imposed on the east and south of the country and calls for help by ethnic Russians there but the two powers should not sacrifice relations over it.
In an hour-long telephone call last night Barack Obama urged Putin to accept the terms of a potential diplomatic solution to the crisis whereby Moscow would keep its military bases in Crimea while respecting Ukraine’s sovereignty. But he also ordered sanctions – including travel bans and freezing of assets in the U.S. - on people responsible for Moscow’s intervention in Ukraine though Putin himself is not on the list.
Obama also said a Crimean referendum on joining Russia, called for 9 days’ time, violated international law.
Meanwhile, Congress passed a $1 billion loan guarantees package for the new government in Kiev. The European Union has already promised some $15 billion over the next two years, contingent on a deal being signed with the IMF.
In terms of sticks not carrots, the EU stopped a little short of Washington. An emergency summit of the bloc’s leaders condemned Russian actions in Crimea as illegal but took only minor steps, suspending talks with Moscow on visas and a new investment pact while warning of tougher measures if there is no negotiated solution soon.
Worrying escalation in Crimea. Interfax reports Russian servicemen have take over a military airport in the Russian-speaking region of Ukraine and armed men are also patrolling the airport at Crimea’s regional centre of Simferopol.
Kiev has condemned the moves as an “armed invasion”.
There has been no bloodshed and there are more constructive noises from Moscow to weigh in the balance.
Russia’s next move remains the great unanswered question for Ukraine but there are glimmers that things might be starting to move elsewhere.
IMF chief Christine Lagarde said last night she would send a technical support team to Ukraine soon if Kiev makes a request. It can’t do so until an interim government is formed, probably tomorrow. That would be step one, but only step one, down the road to an international aid package.
If the hastily drawn up timetable is adhered to an interim Ukrainian government will be formed today. Whatever the line-up, it is likely to repeat its urgent call for aid.
The West, led by the EU, is trying to drum up support – Brussels has already talked with Japan, China, Canada, Turkey and the United States on possible help -- but the signals are that big money will only flow after May 25 elections when a permanent government is in place. Can it wait that long? The IMF adds that conditions it imposed on a previous loan offer would still apply, strings that it would be tough for any government in Kiev to meet.
Violence in Ukraine has escalated to a whole new level. The health ministry says 25 people have been killed in fighting between anti-government protesters and police who tried to clear a central square in Kiev. The crackdown, it seems, has been launched.
President Viktor Yanukovich met opposition leaders for talks last night but his opponents, Vitaly Klitschko and Arseny Yatsenyuk, quit the talks without reaching any agreement on how to end the violence and said they would not return while blood is being shed.
Italy’s president will meet centre-left leader Matteo Renzi today and is likely to ask him to form a government following the ousting of Enrico Letta as prime minister.
Renzi will need to reach an agreement with the small New Centre Right party to continue the current coalition and there is common ground. The 39-year-old has already said he backs lower taxes affecting employment, but they differ on issues such as immigration and laws allowing gay and lesbian civil partnerships.
By Dominic Elliott
The author is a Reuters Breakingviews columnist. The opinions expressed are her own.
Commerzbank could yet jazz up BNP Paribas’ bland strategy. France’s biggest bank by assets unveiled underwhelming targets on Feb. 13: a 10 percent return on equity by 2016, a scarcely bigger dividend payout and another 800 million euros of cost cuts. A 4.5 percent drop in BNP’s share price suggests investors want something meatier.
Dramatic twist in the Ukraine saga last night with a conversation between a State Department official and the U.S. ambassador to Ukraine posted on YouTube which appeared to show the official, Assistant Secretary of State Victoria Nuland, deliberating on the make-up of the next government in Kiev.
That led to a furious tit-for-tat with Moscow accusing Washington of planning a coup and the United States in turn saying Russia had leaked the video, which carried subtitles in Russian. A Kremlin aide said Moscow might block U.S. "interference" in Kiev.
Slowing growth in the Chinese and U.S. factory sectors earlier this week did nothing to soothe frayed market nerves and put a firm focus on today’s service sector PMI surveys in Europe along with the equivalent U.S. report and a weekly jobless number there.
While the world’s two largest economies suffered a hiccup, euro zone factories had their best month since mid-2011 in January. But it is the service sector that dominates in Europe. Flash readings, which are not usually revised much, showed the euro zone services reading hit a four-month high with France lagging Germany again although even its number rose. Today we’ll get the first numbers for Italy, Spain and Britain.
from Mark Leonard:
This week, Germany’s foreign policy establishment struck back against a public they say has become increasingly insular, self-satisfied and pacifist. In surprisingly blunt language, German President Joachim Gauck took to the stage last Friday at the Munich Security Conference to declare: “While there are genuine pacifists in Germany, there are also people who use Germany’s guilt for its past as a shield for laziness or a desire to disengage from the world.”
Gauck asked if Germany’s historical sins mean that it has more, rather than less, responsibility to defend the fragile foundations of an economy and a peaceful world order from which it has disproportionately benefited. In the speech, Gauck was attacking without naming the former Foreign Minister Guido Westerwelle, whose talk of a “culture of restraint” and strong opposition to euro zone bailouts were attempts to channel Germany’s public mood of disengagement.