Ukraine imposes trade blockade of pro-Russian territories in Donbas

Ukraine imposes trade blockade of pro-Russian territories in Donbas
Ukrainian President Petro Poroshenko with Prime Minister Volodymyr Groysman.
By bne IntelliNews March 15, 2017

After an unsuccessful attempt to stop by force a blockade of rebel-held territories in Donbas initiated by Ukrainian far-right nationalists and military veterans, the Ukrainian authorities have done a U-turn and now ordered the imposition of an official trade blockade of the region.

The move, announced on March 15 at a meeting of security chiefs in Kyiv, marks a sudden turnaround in policy after the government’s initial attempt to end the unofficial blockade by government law enforcers a day earlier merely resulted in the swift release of dozens of detained protesters.

President Petro Poroshenko proposed to Ukraine's National Security and Defence Council (NSDC) the suspension of transport communications with rebel-held areas in the eastern Donbas region. “It [the official blockade] will be in effect until the occupiers return the stolen Ukrainian enterprises to the jurisdiction of Ukraine,” Poroshenko said in an address to the NSDC.

A group of far-right Ukrainian nationalists and pro-government veterans of the Donbas conflict announced in December their intention to block trade with coal-producing eastern parts of the country that are controlled by Russia-backed rebels in protest at continued trade with the separatist region.

The rail blockade led to acute shortages of anthracite coking coal, which accounts for one-third of all electricity generated in Ukraine. Poroshenko accused the protesters of inflicting broad damage to the state, citing harm done to the population and also key industries like metallurgy by the fuel shortages.

Responding to the blockade, the so-called Russian-backed separatist Donetsk People's Republic (DPR) imposed “external management” on over 40 enterprises owned by Ukrainian interests. Similar actions were taken at enterprises in the neighbouring Luhansk People's Republic (LPR) that are controlled by Ukrainian oligarch Rinat Akhmetov to ensure payment of their taxes locally and not to Kyiv.

“Self-appointed leaders have seized, stolen Ukrainian enterprises,” Poroshenko complained on March 15. “The tentative value of the seized assets is $2bn. Some of the owners – and we appreciate this – have shut down production.”

He did not, however, explain how an official government blockade would also not harm the national economy through continued fuel shortages.

Two hours later, NSDC Secretary Oleksandr Turchynov said that all motorways and railroads running towards the contact line between pro-Kyiv forces and the rebels in Donbas would be blocked by 1 pm Kyiv time on March 15.

At the same time, Information Policy Minister Yuriy Stets underlined that the NSDC has decided on the full suspension of freight transportation services with rebel-controlled territories, excluding “humanitarian freight and transportation of passengers”.

Almost immediately, the Opposition Bloc party, partly controlled by Akhmetov, said in a statement that the NSDC decisions violate Ukraine’s constitution. “The NSDC decision is blatant political capitulation before violators of the law. This is evidence of the helplessness of the authorities, their inability to institute legal order in the country, ensure constitutional rule, and guarantee the rights and liberties of Ukrainian citizens,” the statement reads, according to Interfax news agency.