Mixed reaction to Russian offer to reduce tensions in Ukraine

By bne IntelliNews May 8, 2014

bne -


Reaction in the West to President Vladimir Putin's statements on May 7 suggesting Russia is ready to help reduce the tension in Ukraine have been mixed, as the US and EU scramble to work out how serious the offer may be. Meanwhile, the EU moved to expand sanctions against Moscow.

Putin surprised by announcing the Kremlin views the upcoming presidential election in Ukraine as a "step in the right direction". He also called on separatists in the east to delay a referendum on autonomy they had planned for May 11, and claimed Russian troops have been pulled back from the border.

Putin made the announcements following negotiations with Swiss counterpart and current OECD head Didier Burkhalter. He also told reporters: "I have recently talked to the federal chancellor of Germany and Mrs. Merkel suggested holding a roundtable meeting. We back this idea, we believe it's a good proposal and we will do everything to promote it."

The reaction in the West was one of surprise mixed with suspicion. Swedish Foreign Minister Carl Bildt wrote on his Twitter page:  "Some sort of [a] fake referendum in Eastern Ukraine on May 11 was part of [a] destabilisation plan. [A] good step if Moscow now ditches it."

De facto head of Ukraine's pro-Russian Party of Regions and presidential candidate Sergiy Tigipko signalled hope that Putin means what he says. "If we talk about Luhansk and Donetsk, we can't deal with this on our own," he said. "We need international support, so that the US, Germany and Russia reach an agreement. Let's say openly: if Moscow wants to fuel this conflict, it's going to last forever.. I am afraid, we can't do this on our own."

British Foreign Secretary William Hague was more tight lipped. "All sides in the Geneva negotiations must recognize Ukraine's right to hold presidential elections," he said. He also insisted that all interested parties fulfill their commitments and claimed the problem was that Russia had not taken any concrete steps to meet the commitments it undertook in Geneva.

US Assistant Secretary for European and Eurasian Affairs Victoria Nuland took a similar line. "If Russia destabilizes the forthcoming elections in Ukraine, if Russian military men cross the border, new sanctions will be introduced," she said in Washington. "Strengthening sanctions against the sectors [of the Russian economy] is an absolutely necessary step, it is a powerful instrument and, as you know, the sanctions are already influencing the Russian economy… We leave possibilities for diplomacy open."

Ukrainian presidential candidate Petro Poroshenko was a little more upbeat: "There is a glimmer of hope [for peaceful resolution]," he said following a meeting with German Chancellor Angela Merkel in Berlin. However, that came after the oligarch - who looks set to win the May 25 election - had called for additional sanctions by the West against Russia.

Brussels moved to carry that out earlier the same day, with EU governments reaching a preliminary agreement to expand sanctions, with new names set to be released as early as May 11. The decision should open the way for the bloc to target Russian companies - a move it has so far baulked at - but needs formal backing during a meeting of EU foreign ministers on May 11, reports EurActiv.

"We have political approval, and it will have to be rubber-stamped," one diplomat said, speaking on condition of anonymity. "New sanctions are likely on Monday."

European Council President Herman Van Rompuy wrote on his Twitter page: "Further steps in destabilizing Ukraine will call for additional sanctions. The EU is ready to take decisions, if needed."

Essentially, the sudden adoption of an appeasement stance by Putin appears to have caught the West off guard, and the US and EU will clearly need to take some time to work out if it is serious, and if so, what any deal might entail.

"There are so many differing views on why Mr Putin did an apparent about-turn last night, but none of us know exactly why," point out analysts at Commerzbank. "So let's just be happy and hope that the door opener provided by Mr Putin is sincere and holds for the EU/US to react positively in return. Western politicians seem to be shocked (in the positive sense) as reactions so far have been that no one sees evidence of the promised pull-back of Russian troops from the Ukrainian border."

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