| Submit your comments on this article |
| Caucasus/Russia/Central Asia |
| The Price of "Novorossiya" |
| 2014-10-02 |
| One of my quibbles with this analysis is the contention by the author that the militia were on the verge of defeat, when in fact the Ukrainians got their asses handed to them by late August near Ilovaisk by pro Russian militia. No question if oil prices really crater, Putin may put his plans on hold. Even as fighting in eastern Ukraine continues between forces loyal to Kyiv and pro-Russian separatists aided by Russian regular forces, we still don't know President Vladimir Putin's real goal. Does Putin simply want to destabilize the southeast to weaken Kyiv? Is he more ambitious and trying to create a quasi-independent statelet there? Or is his ultimate goal to control a swath of land from the Russian-Ukrainian border through Odessa to TransDniestr "so-called "Novorossiya"? ("Novorossiya" is a term coined by Catherine the Great for lands wrested from the Ottoman Empire.) Regardless of what Putin really wants, or whether he has even made up his own mind, Russia is already paying a high price "both economic and political" for Putin's Ukrainian adventurism. Western sanctions have damaged Russia's already slowing economy, reducing the growth rate to "zero, with a minus sign," while precipitating capital flight through August 2014 in amounts surpassing all of 2013. Additionally, the reverse sanctions imposed by Moscow have already led to significant increases in the price of food, ranging from 6 percent in the western parts of Russia to 26 percent in the Far East. For the rest of 2014, the overall inflation rate will be between 7-7.5 percent. Russian companies, now cut off from Western financial markets, are facing difficulties refinancing their debts. For example, Sibur, partially owned by Gennady Timchenko (who is on the sanctions list), borrowed $780 million from Sberbank and Rosneft asked for $42 billion from the state. |
| Posted by:badanov |
| #1 "One of my quibbles with this analysis is the contention by the author that the militia were on the verge of defeat, when in fact the Ukrainians got their asses handed to them by late August near Ilovaisk by pro Russian militia." Actually that was the time when Russia openly intervened by sending tanks and heavy machinery plus Russian troops into the Donbas. |
| Posted by: European Conservative 2014-10-02 10:19 |