Putin declared that Western actions were driving Ukraine into anarchy and warned that any sanctions the West places on Russia for its actions there will backfire. Both the U.S. and the 28-nation European Union have raised the possibility of sanctions against Russia.
The U.S. announced a $1 billion aid package Tuesday in energy subsidies to Ukraine, which is scrambling to get international loans to fend off looming bankruptcy. Its finance minister, who has said Ukraine needs $35 billion to get through this year and next, was meeting Tuesday with officials from the International Monetary Fund.
Tensions remained high Tuesday in Crimea, with troops loyal to Moscow firing warning shots to ward off protesting Ukrainian soldiers. Russia took over the strategic peninsula on Saturday, placing its troops around the peninsula’s ferry, military bases and border posts. Two Ukrainian warships remained anchored in the Crimean port of Sevastopol, blocked from leaving by Russian ships.
The new Ukrainian leadership in Kiev, which Putin does not recognize, has accused Moscow of a military invasion in Crimea.
Yet world markets seemed to recover from their fright over the situation in Ukraine, clawing back a large chunk of Monday’s stock losses, while oil, gold, wheat and the Japanese yen gave back some of their gains.
“Confidence in equity markets has been restored as the standoff between Ukraine and Russia is no longer on red alert,” David Madden, market analyst at IG, said Tuesday.
Speaking from his residence outside Moscow, Putin said he still considers Viktor Yanukovych to be Ukraine’s president and hopes that Russia won’t need to use force in predominantly Russian-speaking eastern Ukraine.
“We aren’t going to fight the Ukrainian people,” Putin said, adding that the massive military maneuvers Russia has been doing near Ukraine’s border had been planned and were unrelated to the situation in Ukraine.
Earlier in the day, Putin had ordered tens of thousands of Russian troops participating in those exercises to return to their bases — some 150,000 troops, hundreds of tanks and dozens of aircraft in all.
Putin also insisted that the Russian military deployment in Crimea has remained within the limits set by a bilateral agreement on a Russian military base there. He said Russia had no intention of annexing Crimea, but insisted its residents have the right to determine the region’s status in a referendum set for later this month.
Putin accused the West of using Yanukovych’s decision in November to ditch a pact with the EU in favor of closer ties with Russia to encourage the months of protests that drove him from power and put Ukraine’s future in turmoil.
“We have told them a thousand times ‘Why are you splitting the country?”’ he said.
Yet he acknowledged that Yanukovych has no political future and said Russia gave him shelter only to save his life. Ukraine’s new government wants to put the fugitive leader on trial for the deaths of over 80 people during protests last month in Kiev.
Ukraine’s dire finances were a key issue in the protests that drove Yanukovych from power. On Tuesday, Russia’s state-controlled natural gas giant Gazprom said it will cancel a price discount on gas it sells to Ukraine. Russia had offered the discount in December as part of Russian help for Ukraine. Gazprom also said Ukraine owes it $1.5 billion.
Crimea still remained a potential flashpoint. Pro-Russian troops who had taken control of the Belbek air base in Crimea fired warning shots into the air Tuesday as around 300 Ukrainian soldiers, who previously manned the airfield, demanded their jobs back.
About a dozen soldiers at the base warned the Ukrainians, who were marching unarmed, not to approach. They fired several warning shots into the air and said they would shoot the Ukrainians if they continued to march toward them.
The new Ukrainian government has said the troops that have overtaken Belbek and other Ukrainian military bases across Crimea were Russian, but Putin denied it, saying they were self-defense forces answering to Crimea’s pro-Russian regional government.
Putin said 22,000 Ukrainian soldiers in Crimea have “dispersed.” He didn’t explain if that meant they had just left their posts or if they had switched allegiances from Kiev to the local pro-Russian government. Those officials claimed Tuesday that 5,500 Ukrainian soldiers had pledged allegiance to them and said they were seeking to move up a vote planned for March 30 on the region’s status.
At the United Nations in New York, Russia’s ambassador to the U.N., Vitaly Churkin, said Russia was entitled to deploy up to 25,000 troops in Crimea under the agreement.
Russia is demanding the implementation of a Western-sponsored peace deal that Yanukovych signed with the opposition last month that set a new Ukrainian presidential election no later than December. Yanukovych fled the capital hours after the signing and ended up in Russia, and the Ukrainian parliament then set the vote for May 25.
In Brussels, meanwhile, the ambassadors of NATO’s 28 member nations held another emergency meeting on Ukraine at the request of Poland, which borders both Russia and Ukraine. The alliance said it and Russia agreed to discuss the latest developments in Ukraine at a special meeting Wednesday.
NATO chief Anders Fogh Rasmussen has said Russia’s military intervention in Ukraine violates the U.N. charter and threatens peace and security in Europe.
President Barack Obama has said Russia is “on the wrong side of history” in Ukraine and its actions violate international law. Obama says the U.S. is considering economic and diplomatic options that will isolate Russia.
In return, Russia’s agricultural oversight agency on Tuesday reversed its earlier decision to lift the ban on imports of U.S. pork. It said the existing U.S. system of checks don’t guarantee its safety.
The European Union’s foreign ministers on Monday threatened Moscow with halting talks on visa liberalization and negotiations on further economic cooperation unless Russian troops in Crimea pull back over the next three days. The bloc’s 28 heads of state and government will hold an emergency meeting Thursday to decide whether to impose sanctions against Russia.
Putin’s economic adviser, Sergei Glazyev, says Russia can develop financial ties with other nations to offset any potential Western sanctions.
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