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 Russia wants to ruin Ukraine and hold a veto over efforts to rescue it, - Financial Times

The West should resist Russia’s blackmail over Ukraine’s debt.

Censor.NET reports citing Martin Wolf, journalist at Financial Times.

According to him, to understand what a "barefaced cheek" is one has to imagine a man who murders his parents and then begs for the mercy of the court as a poor orphan. However, there is another definition. On a flimsy pretext, a country seizes some of a neighbor's territory and foments a civil war in the rest. But it also insists that if a debt incurred by its ruined victim is not paid in full, it will veto the international assistance its actions have made vital. Wolf adds that the story is worse even than this.

Back in December 2013, Russia extended a $3 bln loan to Ukraine intended to sweeten the decision by Viktor Yanukovych, the subsequently ousted president, to reject an association agreement with the EU. Today, Russia apparently wants the international community to fund repayment of the money in full.

In reality, the author says, Russia wants to veto a planned $17.5 bln loan from the International Monetary Fund aimed at helping the country it has sought to ruin. Legally, the IMF may not lend to a country if it is in arrears on an official loan. Russia is arguing that the bond, which it bought on terms favorable to Ukraine, was such a concessional loan.

"In effect, Moscow wishes to use the leverage of this loan, to prevent its victim from being helped," the article notes. Wolf says a starting point for the West is to reject the justifications Russia feels and the reasons it advances for its hostility towards the current government of Ukraine. The Kremlin argues that, if Ukraine became closer to the West, its own security would be threatened. But the West poses no military danger to this nuclear-armed country, while Russia is such a threat to its own neighbors.

Read more: $3 bln write-down and $8.5 bln restructuring of Ukraine's debt approved, - Yatseniuk

According to the author, many Russians seem to believe that history gives them ownership of Ukraine. This should not be accepted as well as Russia's believes it is entitled to seize territory by force. While rejecting such Russian attitudes, the author says, the West should seek a modus vivendi with it on all big issues, including, not least, Ukraine.

But it should do so without sacrificing Ukraine itself. Speaking of Ukraine's debt, Adam Lerrick of the American Enterprise Institute has suggested to compensate Russia for the favorable terms offered in the original loan and then treat the loan in the same way as other commercial debts. If Russia wanted a reasonable deal, it would accept this proposal, which meets its ostensible demands, notably a refusal to accept a writedown of face value. Almost certainly, it has no interest in any deal and so will reject it. That would at least clarify its true objectives, which are, almost certainly, to halt IMF loans and so foil Ukraine's recovery. If so, the West must not let Russia succeed. A way needs to be found to lend the money Ukraine desperately needs. Russia cannot be allowed both to ruin Ukraine and hold a veto over efforts to rescue it. It should be made clear that such uncooperative behavior merits further tightening of sanctions.

Read more: Minister Jaresko: IMF to continue support Ukraine even with Russia's loan unpaid
 
 
 
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