Germany Sees ‘Last Chance’ for Peace as Putin Blames Ukraine

[VJ_Messiah 22]

http://www.bloomberg.com/news/2015-01-23/germany-warns-of-last-chance-for-ukraine-peace-amid-fighting.html

Germany warned that time is running out to halt spiraling violence in eastern Ukraine as it called on Russia and the government in Kiev to stand by pledges to bring the crisis to an end.

Ukraine and Russia must seize “what may be the last chance for a peaceful solution” by fulfilling commitments to secure a cease-fire and withdraw heavy weaponry, German Foreign Minister Frank-Walter Steinmeier said in an e-mailed statement late Thursday. They must “do everything to ensure the spiral of violence and counter-violence is stopped,” he said.

Russian President Vladimir Putin accused Ukrainian forces of starting “large-scale” military operations against the rebels in comments broadcast on state television. Defense Ministry officials in Ukraine reported more than 100 attacks by pro-Russian separatists in the past 24 hours.

While the foreign ministers of Ukraine, Russia, Germany and France reported “tangible progress” in Berlin talks Wednesday, fighting continues between government troops and separatists. Ukrainian President Petro Poroshenko warned in a Bloomberg Television interview of a “grave danger” of escalation in the 10-month conflict that has claimed more than 5,000 lives, according to the United Nations.

Heavy Weapons

Ukraine and its allies in the U.S. and the European Union blame Russia for arming and aiding the rebels in the Donetsk and Luhansk regions, while Russia accuses the government in Kiev of a military onslaught against its own citizens. The conflict has sent Russia-U.S. ties to their worst since the Cold War.

Ukrainian forces are shelling densely populated areas indiscriminately, causing dozens of civilian casualties, Putin told a meeting of the Security Council Friday, according to a Kremlin transcript. Russia received no clear answer to its proposal for heavy weapons to be pulled out of eastern Ukraine, he said.

Putin led officials in a minute’s silence for victims of a mortar attack Thursday that killed eight people and wounded seven at a bus stop in Donetsk. The conflict can only be resolved through negotiation and he hoped “common sense” will prevail, he said.

‘Eliminate’ Threat

Alexander Zakharchenko, separatist leader of the self-proclaimed Donetsk People’s Republic, ruled out truce talks with Kiev, saying rebel forces will “advance to the borders of the Donetsk region” and “eliminate” any threat they find, Interfax news service reported Friday. He said he will only talk to Poroshenko and saw no point in negotiating with the Ukraine contact group, according to Interfax.

It is “critically important” for the contact group to meet rebel leaders because they signed a cease-fire deal agreed in Minsk, Belarus, in September, Ukrainian Foreign Minister Pavlo Klimkin said in an interview Friday in Davos, Switzerland.

The group, which includes representatives of Ukraine, Russia, the Organization for Security and Cooperation in Europe and the separatists, should meet this week to discuss a line of contact, withdrawal of forces, prisoner exchanges and humanitarian issues, Klimkin said. Russia refused to discuss implementing the Minsk accord in Berlin, he said.

‘Horrifying Events’

There’s no quick political solution to the Ukraine crisis, Russian First Deputy Prime Minister Igor Shuvalov told a forum in Davos Friday. Pressuring Russia with sanctions won’t help resolve the conflict, VTB Group Chairman Andrey Kostin said at the same event.

Steinmeier said “unscrupulous groups” on both sides are intent on thwarting peace efforts and he expressed shock at the “horrifying events” in Donetsk.

Three servicemen died and 50 were wounded in the past 24 hours, while rebels hold more than 600 prisoners, military spokesman Andriy Lysenko told reporters in Kiev Friday. Ukrainian troops faced 115 rebel attacks in the same period, military spokesman Leonid Matyukhin said Friday in Kiev.

Rebels may be using banned gas in attacks on government forces, Lysenko said. Russia has 9,000 troops inside Ukraine, the highest number since the conflict began, and is sending 30 to 40 vehicles with weapons across the border daily, he said.

Russia on Tuesday dismissed the notion its soldiers are involved as “absolute nonsense.”

‘Major Escalation’

Ten servicemen died as government forces pulled back from the Donetsk airport, an epicenter of clashes, the military said Thursday, the Ukraine’s army’s worst casualties in two weeks. The army said it still controls parts of the facility, where fighting continues.

Rebel threats to advance to the border of Donetsk region represent a “major escalation,” Tim Ash, chief economist for emerging markets at Standard Bank Group Ltd. in London, said in e-mailed comments Friday. “We are rapidly approaching a full-scale war now in Ukraine.”

Meanwhile, Putin spoke with IMF Managing Director Christine Lagarde by phone Thursday about international cooperation on Ukraine’s “severe economic and financial crisis,” according to a Kremlin statement. They discussed the International Monetary Fund’s “possible steps” in response to Ukraine’s request for a new long-term loan program, it said.

IMF Funding

Ukraine hopes to receive the first installment of money under the IMF’s Extended Fund Facility program by the end of February or early March, Interfax reported, citing Finance Minister Natalie Jaresko in Davos. Ukrainian 2017 dollar debt gained 0.6 cents to 54.7 cents on the dollar, data compiled by Bloomberg show.

The Ukrainian government will approach bondholders to negotiate more favorable terms after talks with the IMF over aid to top up a $17 billion rescue, Jaresko said Wednesday in an interview in Davos.

German Chancellor Angela Merkel accused Russia of undermining Ukraine’s sovereignty and breaching the principles of post-World War II European order by annexing Crimea. Russia’s absorption of the peninsula in March can’t be allowed to pass and sanctions should remain, she said in Davos Thursday.

Merkel held out an olive branch to Putin, saying she was ready to look at EU cooperation with the new Russian-led Eurasian Union. “The condition is that we have a cease-fire, that there’s a return to control of the Russian-Ukrainian border,” she said.

Merkel remains open to resuming suspended talks on EU-Russia trade links once the Ukraine crisis is resolved, German government spokeswoman Christiane Wirtz told reporters in Berlin Friday.

Edited January 23, 2015 by VJ_Messiah