West must take some of the blame for Kyiv's burning

By bne IntelliNews February 19, 2014

Ben Aris in Moscow -

The body in Kyiv count stood at 25 dead as of 6 a.m. local time with and will almost certainly rise again today, as Ukraine's capital saw its worst violence since the stand off between the government and protestors kicked off in November on February 18. Ukrainian security forces launched the long awaited attack in an attempt to break the deadlock and clear protestors from the streets of the capital. "Ukraine is over the brink," Swedish Foreign Minister Carl Bildt said via his Twitter account.

The streets of the capital resemble a scene from hell, with a ring of fire surrounding an estimated 20,000 protestors holding out on Independence Square, known as Maidan, in the centre of the capital. Despite months of diplomatic effort, the West has failed to prevent Ukrainian President Viktor Yanukovych taking the worst of all possible options: sending in the police to attempt to clear the square.

Divided we fall

The west is caught on the horns of a dilemma. On the one hand it has set itself up on the moral high ground by vaunting its respect for the democratic process and rule of law. On the other it is playing a real life version of the game Risk, trying to promote its favoured politicians into the seat of power and open the large Ukrainian market to its companies without conceding full access to its own markets.

Currently Ukraine exports some €14.6bn worth of goods to the EU and imports €23.8bn. Under the terms of the Deep and Comprehensive Free Trade Area (DCFTA) tariffs on EU imports would be reduced 'immediately' on signing, whereas those on Ukraine's exports would be reduced 'eventually' once Ukraine has met all the riders imposed on the deal -- and the EU is the one which gets to decide when that point is reached. It could take years.

Torn between conflicting goals there is no unity between members of the EU. German Chancellor Angela Merkel has refused to impose sanctions on Ukraine, while the EU's Commissioner for Enlargement and European Neighbourhood Policy Stefan Fule suggested there would be targeted sanctions if the fighting is not ended. There is also no unity between the US and Brussels, as epitomized by US Assistant Secretary of State Victoria Nuland's now infamous "Fuck the EU" jibe.

Western leaders bombarded Yanukovych with calls on February 19, but the president refused to pick up the phone to almost all. Only US president Barak Obama received an answer, according to reports.

More importantly the West has lost all creditability with the people on the streets of Kyiv. The EU's High Representative for Foreign Affairs Catherine Ashton has released a sting of statements expressing her "concern," but has become the butt of ridicule. One protestor summed the mood up with a post of a spoof memo on Twitter that said: "Dear European Union and United States of America. We no longer need your moral support. Act or fuck off. With Eurolove from EuroUkraine."

In the moral vacuum left by the west's indecisiveness, Russia has not only been left to act alone, but has realistically been the only place to go for the embattled Yanukovych, who is facing an economic meltdown.

For his part Putin has left Yanukovych to stew in his own juices. With the West unable to offer a realistic alternative, doing nothing only improves Russia's hand in Ukraine. Even if it didn't have ambition to promote its strategic and economic interests in Ukraine (and clearly it does), as the situation deteriorates, the Kremlin's hand in the negotiations for the eventual clean up operation is improving by the day. Yanukovych reportedly tried to call Putin several times as the battles in Kyiv raged, but the Russian president was "busy."

The grand prize on offer, that looked until now unobtainable, is ownership of Ukraine's gas pipelines to the west. In the last two years Russia has already bought the Belarusian pipelines, and only this January closed a deal to take over the Kyrgyz pipelines.

While most of the attention has focused on the politics and street violence, in the background the Ukrainian economic is already in meltdown. The hryvna has lost more than 10% of its value since the start of the year, retail sales have slumped by a third, and hard currency reserves have halved year-on-year to $17.7bn, or about 2.3 months of import cover.

It can only get worse from here. Ukraine has a heavy debt repayment schedule this year with some $6bn worth of short-term bonds come due, and a similar level of payments every year until 2018. With hard currency reserves covering only a quarter of this debt (economists recommend 100% cover) Ukraine was already looking like a failed state from an economic perspective - and that was before law and order completely broke down.

How does this end?

By the time the sun went down on February 19 the situation in Ukraine was already totally out of control. Since the events, a negotiated solution is probably no longer possible. The opposition leaders - Vitali Klitschko of the UDAR party and Arseniy Yatsenyuk of the Fatherland party - met with Yanukovych overnight, but nothing came of the meeting. Klitschko told reporters: "We spoke to Yanukovych for about an hour. He put the responsibility on the opposition. The talk was senseless."

The major battle is now focussed on Maidan. The police arrived with armoured trucks, water canon and APCs. They faced some 20,000 protestors armed with the Berkut riot police's own shields, home made body armour and Molotov cocktails. Facing down the phalanx of riot police, the defenders of Maidan quickly adopted a "scorched earth" policy, building an enormous ring of fire as their only effective defence against the advancing police.

Several buildings surround the square caught on fire, including the House of Trade Unions, which previously was used as a revolutionary headquarters. However, despite their superior position in terms of equipment, the Berkut failed to douse the flames or make much progress into the square.

There is unlikely to be any quick victory for either side. Clearly Yanukovych has used the recent two week hiatus in hostilities to shore up his position and plan this operation, but the fact that the government forces have been unable to quickly take the square bodes ill for the next few days.

The government's basic problem is it is badly short of numbers. Yanukovych has been relying entirely on the Berkut to do most of his fighting, but despite the effectiveness of these specially trained forces they number only about 8,000, which is not enough to score a decisive victory against such a large and increasingly violent crowd. Turning to the army is not an option. Apart from the fact that the ministry of defence has already declared neutrality in that sense, the president may not be able to rely on the rank and file to carry out orders should he put them in the field.

There are also reports of police abandoning their posts and joining the opposition. According to Zik.ua police guarding the offices of the department of internal affairs in the regional city of Ternopil abandoned the defence of the building and joined the protestors, who received them with chants of "the police are with the people."

A stand off of equally balanced forces is the worst possible scenario. While it is impossible to call at this point, a major worry is that Ukraine could break up into a nationalist west and Russophile east. Indeed, some Russian lawmakers have already suggested Ukraine adopt a federal government structure that gives more power to the regions, and in effect would make it easier to cleave the country into two.

In the meantime, the stand off on Maidan this morning will only push the government to its last remaining option: live ammunition. Snipers are already present on the rooves of the city. A bne correspondent reports being in the crowd overnight when a middle-aged women close by suddenly dropped to the ground. Doctors in an impromptu medical centre set up in a church told the opposition that most of those arriving for treatment had bullet wounds.

field hospitals have been set up in hospitals around Maidan

To make things worse there are many reports that the government has turned to the Titushki - nationalistic street fighters - for reinforcements. Operating entirely outside the law, there are numerous reports saying these men are armed with pistols and shooting people indiscriminately in the street. A video shows a demonstrator standing shot down at random in a quiet street far from the fighting by unseen assailants, which the poster of the video claims were Titushki.

Gangs of Titushki are also reportedly roaming the streets surrounding Maidan and attacking anyone attempting to make their way to reinforce the defenders on the square.

And the violence is spreading. As of 6am today news services report that three more cities in central Ukraine have seen violence flare. Yesterday, protestors attack and took the police offices in the western city of Lviv that has traditionally been a centre for Ukrainian nationalist sentiment. This could mean the protestors in west are now armed as well.

"Whatever happens in Kiev now will not solve the crisis in #Ukraine. Centrifugal forces have been released. Instability likely to be permanent," Russian analyst Dmitri Trenin tweeted.

As the sun came up on Maidan this morning both the Berkut and protestors are waiting for reinforcements to arrive on Maidan and another days of violence and death is to be expected.

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