The complexities of Ukraine's crisis - an East West tussle?

The complexities of Ukraine's crisis - an East West tussle?
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Can the European Union afford to bail out Ukraine?

Professor Stefan Hedlund:

Well the most immediate problem that the EU faces when it gets involve with Ukraine is that the Ukrainian economy is in need of around US$24 billion just to tide it over this year, and including next year maybe US$35 to US$37 billion.

So the question is if the EU is going to pick up that bill, where is the money going to come from?

And there’s a big credibility problem with relation to taxpayers within the European Union, because the Ukrainians do have an image problem.

Some of the pictures out of Kiev have been of heroic defenders of democracy, but other pictures have been of slightly less savory characters – there are a lot of problems with xenophobic and right-wing elements in Kiev. So it may be difficult to sell that package.

The IMF may do it, but they will want conditionality.

It’s far from clear to me that the European Union really understands what the implications are in talking about 'a big aid package' to Ukraine.

A second dimension is that if Russia discovers that the European Union is pouring money into Ukraine, then Russia may start pulling money out of Ukraine. It may jack up the gas price by removing the discount it awarded recently, or it may simply claim that now Ukraine has money they will demand it pays its gas bills. The gas bill was US$3.3 billion at the end of January. It iss probably much higher now.

So if money comes in from the West, Russia may suck it out to the East.

Who will emerge from Ukraine’s current power vacuum?

Professor Stefan Hedlund:

This is really the key question when it comes to political future of the country.

There are several players who want to take responsibility for the future of the country, to form a government and to run for the presidency. But it’s very unclear to most observers, I would say, who has what it takes.

Some will probably be part of the problem rather than the solution, especially former Prime Minister Yulia Tymoshenko who was let out of prison very recently as part of the deal.

She has said she doesn’t want to become prime minister, meaning she probably wants to become president. I’m very doubtful that she would be elected, but by throwing herself into the fray between a number of other candidates she may complicate the process. Because she obviously has a lot of support within the elite, and what we need today is not further fragmentation but unification.

I don’t really see those candidates emerging either to form a government that will keep the country together and at peace, or a president that will be able to lord it over all those warring factions.

With Yanukovych’s people out of the game there will be a scramble to claim the assets that they had in their pockets – and somebody will need to manage that scramble.

Do we see that person emerging? No. So Kiev is in a vacuum and the regions are trying to respond to this in various ways.

Will Russia try to reclaim Ukraine’s Crimea?

Professor Stefan Hedlund:

The only clear answer to this is that Russia is very angry.

Russia was part of the deal that was brokered. That said, people should clear the Maidan, there should be new elections for parliament first and then there should be elections for the presidency maybe in December. Now that deal has been scuppered.

Now it’s very worrying that the first thing Ms Tymoshenko said when she was let our of prison was ‘do not leave the Maidan’ – that broke the first part of the deal.

The second part of the deal was broken when the parliament in Kiev voted to get rid of Yanukovych, because the Russians had insisted that he should remain in power at least until December. So the main components from the Russian point of view have already been scuppered. And does Russia feel it really needs to stick to any of the other parts now? That remains to be seen.

And we see a number of Western leaders pointing fingers at Russia saying ‘You stay out of this – don’t scupper the economic deal, don’t get involved militarily’.

What really is needed is communication and consensus between Russia and the West. But what has happened over the past few days is the exact opposite of what is needed.

So the question is, where is Yanukovych? Are the Russians holding him somewhere, and will he resurface? Are the Russian’s pondering some other type of game?

There is a lot of military movement at and around the Crimea that is causing a lot of speculation that the Russians are going to reclaim Crimea – which up until the 1950s was part of the Russian Soviet Republic, and was given to the Ukrainian Soviet Republic at a time when that didn’t really matter.

Today it’s part of the sovereign state of Ukraine and it is of vital interest to the Russians.

There has been speculation, and have even been suggestions from Kremlin spokesmen that maybe a solution to the Ukrainian crisis is federalisation. And if Ukraine becomes a federalised state, Russia may enter as ‘protector’ for parts of the federation that are within its sphere of interest – especially Crimea - but maybe other parts of the east.

So although Ukraine is likely to remain whole from a perspective of international law, the actual sovereignty of the state may become compromised if Russia and the West cannot agree on what the rules of the game are going to be as we move forward.

The only really positive thing to come out of the last few days, is that with Yanukovych gone so much of the tension has been diffused that the risk of a civil war in Ukraine and that its neighbours will be drawn into a war with Ukraine is now very small compared to what it was just a week ago.

But there are all kinds of centrifugal forces at play, and dangers to the economy and political stability that will remain with us probably for some time to come.

We will need to get used to Ukraine being a source of trouble for months ahead.

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