Bloomberg News

Ukraine Warns of Europe’s Worst Conflict Since World War II 

September 01, 2014

Donetsk

A man looks at a youth culture center damaged during clashes between pro-Russian separatists and Ukrainian forces, in Donetsk on Aug. 28, 2014. Photographer: Alexander Ermochenko/Anadolu Agency/Getty Images

Ukraine warned of an escalating conflict in its easternmost regions as a rebel leader said talks this week may include negotiations for a truce.

The country’s military will take on Russia’s “full-scale invasion,” Defense Minister Valeriy Geletey said on Facebook today, a shift away from the government’s earlier communication that focused on an offensive against insurgents. Ukraine “must urgently build up defenses against Russia,” which is seeking “to advance to other areas in Ukraine,” Geletey said.

Ukraine and its allies in the U.S. and Europe are accusing Russia of dispatching troops and backing militias to open a new front in the conflict that the United Nations estimates has claimed 2,600 lives. The Kremlin has repeatedly denied involvement in the unrest. Talks today between representatives from Russia, Ukraine, the Organization for Security and Cooperation in Europe and the separatists will continue Sept. 5.

Map: Tracking the Ukrainian Conflict

“We can truly imagine some very dark scenarios now,” OSCE Chairman Didier Burkhalter said on Swiss state television today. “We are in a very delicate phase.” As long as the war continues, “the risks of escalation are very, very numerous.”

Consultations on Sept. 5 will include discussions of a prisoner swap and possible talks on a future cease-fire, Andrei Purgin, deputy premier of the Donetsk People’s Republic, said in a statement after today’s meetings in Minsk, Belarus.

“We are trying to find common ground, to cut back on war and victims as much as possible,” Purgin said.

Putin’s Call

Standoff in Ukraine

Russian President Vladimir Putin yesterday called for negotiations over greater autonomy for the war-torn regions. His spokesman, Dmitry Peskov, later told reporters that the president isn’t seeking “statehood” for the region.

The ruble slid to a record against the dollar for a second day as the intensified conflict raised the likelihood that Russia will face wider European Union sanctions. It traded 0.6 percent weaker at 37.3325 as of 7:35 p.m. in Moscow after falling to an all-time low of 37.45. The Micex Index of equities slipped 0.6 percent.

German Chancellor Angela Merkel said Europeans won’t accept Russia’s military incursion into Ukraine.

“Being able to change borders in Europe without consequences, and attacking other countries with troops, is in my view a far greater danger than having to accept certain disadvantages for the economy,” Merkel said today at a news conference in Berlin.

Civilian Deaths

At least 300 civilians have been killed by explosions around Luhansk since May, according to New York-based Human Rights Watch. Many of the attacks appeared to be indiscriminate and could violate international laws of war, the group said.

Regular Russian troops are replacing insurgent forces, with about 1,600 soldiers advancing into the region, according to the government in Kiev. Andriy Lysenko, a spokesman for the Ukrainian military, said at least four Russian battalions are taking part in operations in southeast Ukraine. There was no immediate response from Russia to the allegations.

The Ukrainian army had moved back from fighting for control of the Luhansk airport and is holding the line after retreat near Donetsk, Lysenko said. Defense Ministry spokesman Leonid Matyukhin said the Ukrainian forces had been fighting against a Russian tank battalion.

Ukrainian troops killed about 100 pro-Russian rebels in the last 24 hours, Matyukhin said in a video statement on Facebook today. Government troops were shelled three times from the Russian side of the border, according to the statement. There was no independent confirmation of the figures.

EU Sanctions

While EU leaders disagreed about possible military aid to Ukraine in a weekend meeting in Brussels, they gave the European Commission a week to deliver proposals for sanctions that may target Russia’s energy and finance industries.

Ukrainian President Petro Poroshenko has called for military and technical assistance for Ukraine from the EU.

The EU and the U.S. have already slapped visa bans and asset freezes on Russian individuals and companies, and since July have imposed steadily tougher sanctions targeting the country’s energy, finance and defense industries.

“Putin’s army will be stopped where the Ukrainians, the West and the whole world decide to stop him.” Andrei Illarionov, a former economic adviser to Putin who’s been critical of the Russian leader after quitting his post in 2005, said today in an interview in the Georgian capital, Tbilisi. “Sanctions don’t have any effect. Historically, there’s no evidence of sanctions achieving their intended goal, even when they were much stricter.”

To contact the reporters on this story: Aliaksandr Kudrytski in Minsk, Belarus at akudrytski@bloomberg.net; Daryna Krasnolutska in Kiev at dkrasnolutsk@bloomberg.net; Jake Rudnitsky in Moscow at jrudnitsky@bloomberg.net

To contact the editors responsible for this story: James M. Gomez at jagomez@bloomberg.net; Balazs Penz at bpenz@bloomberg.net; Hellmuth Tromm at htromm@bloomberg.net Balazs Penz, Leon Mangasarian


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