Vice President Joe Biden expressed U.S. support for Ukraine during a visit to the capital Kiev, as an agreement with Russia to ease tensions in the former Soviet republic’s east showed signs of collapse.
With the April 17 accord fraying, U.S. Secretary of State John Kerry warned Russian Foreign Minister Sergei Lavrov yesterday that “there will be consequences” if Russia doesn’t act “over the next pivotal days” to restrain separatists in Ukraine, spokeswoman Jen Psaki said in Washington. Lavrov called on the U.S. to hold Ukraine’s government accountable for not reining in what Russia portrays as right-wing militias.
Pro-Russian forces who seized buildings in eastern Ukrainian cities have said they are not bound by the deal reached in Geneva by Ukraine, the European Union, the U.S. and Russia. The government in Kiev accuses Russian President Vladimir Putin of stirring unrest and exploiting the situation to possibly lay the groundwork for an invasion, while the U.S. underlined its support for Ukrainian politicians.
“The opportunity to generate a united Ukraine, getting it right, is within your grasp,” Biden told a group of prominent Ukrainians including confectionery magnate Petro Poroshenko, former Prime Minister Yulia Tymoshenko and former world boxing champion Vitali Klitschko. “And we want to be your partner and friend in the project. We want to assist.”
U.S. Aid
The U.S. offered Ukraine $50 million in aid to help it pursue political and economic changes to stabilize its government, Biden’s office said in a statement. That includes $11.4 million for a May 25 presidential election that Biden said “may be the most important election” to date for the country of 45 million people on the Black Sea.
The U.S. will also help Ukraine on issues ranging from non-lethal military aid to the fight against corruption, Biden’s office said in a statement.
After meeting acting Ukrainian President Oleksandr Turchynov and Prime Minister Arseniy Yatsenyuk, Biden said Barack Obama’s administration was also there to help on energy issues “so that Russia can no longer use energy as a political weapon against Ukraine and Europe.”
Russia will demand advance payments for gas supplies to Ukraine unless the country resumes paying its bills, Russian Prime Minister Dmitry Medvedev said. The move, which would cut off gas from Ukraine unless it resumed payments to Russia, would “be a tough but fair decision,” Medvedev said in Russia’s State Duma.
‘Terrorist Units’
The crisis has hit both Russian and Ukrainian markets. Russia’s Micex Index (INDEXCF) index fell 0.9 percent at 5:42 p.m. in Moscow, taking the year-to-date decline to more than 11 percent. The Russian currency was 0.4 percent weaker against the central bank’s target basket of dollars and euros to 41.8349.
The hryvnia, the world’s worst-performing currency this year, retreated after the biggest rally on record last week, depreciating 3.2 percent to 11.67 per dollar. The yield on the government’s dollar notes due in 2023 fell two basis points to 9.83 percent.
Separatists abducted the chief of police in the eastern city of Kramatorsk and took him for “talks” to Slovyansk, where pro-Russian activists have seized government buildings and set up road blocks, Ihor Diomin, the spokesman for Donetsk regional police, told Ukrainian private TV 5 channel today.
‘Act Adequately’
“Unfortunately, Russia and its terrorist units, which are operating in Ukraine, are not going to implement the Geneva agreements,” Turchynov said during the meeting with Biden, according to a statement on the parliament’s website. “Of course, Ukrainian authorities will act adequately.”
In Poland, Prime Minister Donald Tusk called for a Europe-wide energy union, including a single body charged with purchasing gas supplies, as a means of breaking Russia’s “stranglehold” over the region’s market. Sweden proposed measures to buy more fighter jets and submarines amid an increase in geopolitical tensions.
“The profile of the measures is very focused on the Baltic Sea,” Deputy Prime Minister Jan Bjoerklund said at a news conference. Russia “has acted ruthlessly and aggressively” in Ukraine and “those motives could also be used in the Baltic states.”
Further Sanctions?
While the U.S. won’t unveil new sanctions with Biden making the trip to Kiev,Obama’s government hasn’t seen progress on the accord, said an administration official who briefed reporters on condition of anonymity. A decision will be made in a matter of days.
The U.S. has threatened further penalties against Russian interests, including measures targeting the banking and energy industries, unless progress is made in easing the crisis sparked by Russia’s annexation of Crimea last month.
Widening the EU blacklist of visa bans and asset freezes “depends as much as anything else on the situation on the ground,” EU spokesman Michael Mann said today.
The U.S. and EU have called for Russia to withdraw about 40,000 troops from its border with Ukraine, while officials from NATO and the government in Kiev say masked pro-Russian activists in eastern Ukraine are under Putin’s control, who said his troops supported the the safety of a secessionist referendum in Crimea last month.
‘All Ukrainians’
“I know that the men and women who hide behind masks in unmarked uniforms, they do not speak for you,” Biden said in Kiev. “The United States supports all Ukrainians.”
U.S. Ambassador to Ukraine Geoffrey Pyatt said it will take “days, not weeks” to determine whether Russia is complying with the Geneva agreement.
Russia’s Lavrov called on the U.S. to avoid threats of sanctions, while brushing off accusations that Russian forces are involved in attacks in Ukraine. Russia is receiving increasing requests to intervene in eastern Ukraine to protect the Russian-speaking population, he said yesterday in Moscow.
At least three “activists” were shot dead at a roadblock in Slovyansk over the weekend, Ukraine’s Interior Ministry said. The clash wounded three others, the ministry said.
Vyacheslav Ponomaryov, who leads pro-Russian forces in Slovyansk in eastern Ukraine, told reporters yesterday that “the things that were agreed on in Geneva were agreed on without us taking part.”
“We don’t have any relation to the things that were said in Geneva,” Ponomaryov said. “We are not aggressors, we are on our own land.”
To contact the reporters on this story: Julianna Goldman in Kiev at jgoldman6@bloomberg.net; Henry Meyer in Moscow at hmeyer4@bloomberg.net; Daryna Krasnolutska in Kiev at dkrasnolutsk@bloomberg.net
To contact the editors responsible for this story: James M. Gomez at jagomez@bloomberg.net; John Walcott at jwalcott9@bloomberg.net; Balazs Penz at bpenz@bloomberg.net; Steven Komarow at skomarow1@bloomberg.net Paul Abelsky, Balazs Penz
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