UKRAINE: What Now? The IMF Plan

UKRAINE: What Now? The IMF Plan

Obama-Putin telephone discussions, meetings between the U.S. and Russian foreign affairs ministers in Paris . . . the "de-escalation of the Ukraine crisis" is underway. Obama, in Europe, called on the NATO member countries to increase their military spending, and the Russian authorities promised not to cross over the eastern borders into Ukraine. Everything seems to have gone back to normal. The U.S. government, all the while repeating that "nothing will be decided without the Ukrainians," has nonetheless rubber-stamped -- without officially recognizing it -- Crimea's being attached to Russia.

This is all the more true, as the Russian government, which in appearance has "saved face," has come out of this crisis under increased pressure. According to German Gref, the managing director of the biggest bank of Russia, Sberbank, "US$35 billion of capital have been withdrawn from Russia over the first two months of the year." Andrei Klepatch, the Russian vice-minister of the economy, has stated that "the flight of investors has accelerated in March, reaching a total of US$65 billion to $70 billion. That is more than in 2013 ($63 billion)."

Of course, the economic sanctions of the United States and the EU are not alone responsible for this massive flight of capital, which had begun well beforehand, but "the perspective of seeing the sanctions widen . . . is worrying investors today," according to an analyst at Capital Economics. The Russian economy has not escaped the crisis of the global capitalist system, and the Ukrainian crisis has worsened the crisis in Russia itself. These sanctions are far from being approved by all on the "Western" side and have been openly criticized, from the standpoint of their own interests, by both the City of London (in which several Russian "oligarchs" invest heavily) and by the German bosses.

The "Revolution Against the Oligarchy" Has Led to the Candidacies of Corrupt Oligarchs . . .

What now? The circus of the Ukrainian presidential election of May 25 (the date was chosen to coincide with the elections to the European "Parliament") has begun. No fewer than 14 candidates have been registered by the central electoral committee.

The major ones are, obviously, partisans of the European Union-IMF Association Agreement. Among them is the ex-muse of the 2004 "Orange Revolution" and ex-Prime Minister Yulia Tymoshenko, who made a fortune in natural gas, and who declared several days ago that it would be necessary to "exterminate the Russians." There is also Petro Poroshenko, one of the major oligarchs of the country, in support of whom ex-boxer Klitchko withdrew his own candidacy. One can only share the opinion of  journalist Jean-Marie Chauvier when he wrote: "It is striking to realize that 'the revolution against the oligarchy and corruption' has led to the candidacies of . . . the great oligarchs of the much-disparaged 'corrupt regime'!"

The first armed settling of scores has begun within the ruling circles -- and the neo-Nazi group "Pravi Sektor," which yesterday had been so useful for organizing the provocation on the "Euromaidan," is in danger of becoming its first victim. This is needed to give an "acceptable" face-lift to the new governing powers. The "re-conquering of Crimea" and Ukraine's "European choice" are turning out to be very useful subjects to avoid talking about the main problems.

"Ukraine Has Moved Farther Away from Moscow and Much Closer to Athens"

And this is because the main problem is the agreement that was just approved on March 27 between the IMF and the Ukrainian government, which immediately had it ratified by the Parliament.

The U.S. financial magazine Forbes noted:

"With the IMF's $14 billion arrangement, Yats [Prime Minister Yatseniuk] has effectively moved his country westward, farther away from Moscow and much closer to Athens. . . . The quid pro quo of austerity-for-aid is at the heart of Ukraine's bailout program, and it promises to devastate Ukrainian living standards, according to the take by analyst Vlad Signorelli of Bretton Woods Research in Mt. Tabor, New Jersey. . . . At the least, we hope a forthcoming European agreement might facilitate Ukrainian emigration to Western Europe to keep this geopolitical pressure cooker from exploding."

Indeed, "the agreement that has been concluded . . . promises to be painful." It will be "accompanied by the financial oversight of the country . . . , the young prime minister has given a green light that no government before him had accepted: a 50% increase in the price of gas. The medicine will be hard to swallow for the households who are used to extremely low monthly bills . . . . The IMF has also demanded the freezing of civil servant salaries and retirement pensions." (Le Figaro, March 27)

In this light, the warning by former U.S. Secretary of State Madeleine Albright's in the Washington Post (March 22) becomes understandable: "The Ukrainian government," she states, "also needs help . . . with policing, especially riot control."

In the rallies that gather thousands of workers in Kharkov, Donetsk and Odessa every Sunday, where the slogan "Rossiïa, Rossiïa!" had up till now dominated the chanting, social demands are being raised for the first time: "No Cuts to our Wages and Pensions!"

-- Dominique Ferré