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Column The fight for the future of Ukraine is not over – not by a long shot

The deal struck between the government and opposition in Ukraine is a win for the EU … but Russia is not out of the fight, David Moloney.

LAST FRIDAY, 21 February, the Foreign Ministers of France, Germany and Poland, along with the Special Representative of the President of Russia engineered a peace deal between the pro-EU Ukrainian opposition and the Russian-backed President Viktor Yanukovich, which brought an end to the violence that left 77 people dead.

Perhaps the biggest surprise, beside the UK playing no part in the mediation talks, was the fact that Yanukovich signed the deal at all.

So has the EU won the fight for Ukraine?

First set to the EU

On the face of it, the EU was the winner in Friday’s peace deal. The powers of the Ukrainian President are to be curbed; Yulia Tymoshenko, the former Prime Minister and a bête noire of Russian President Vladimir Putin, has been released; and a national unity government is to be formed which will give power to the pro-EU opposition.

With its supporters’ hands on the levers of power for the first time since 2010, the EU has a chance to revive not only its Eastern Partnership (EaP) initiative, which I discussed in my January column, but also the EU-Ukraine Association Agreement (Association Agreement) that Yanukovich decided not to sign at the third EaP Summit in Vilnius on 29 November 2013. It was Yanukovich’s refusal to sign the Association Agreement that sparked the political crisis which left Ukraine paralysed for over three months.

Second set and match to Russia?

Before Yanukovich was ejected from power, Russia promised to reduce the prices that Ukraine pays for its gas to $268.50 per 1,000 cubic meters. With 70 per cent of its gas imports coming from its largest neighbour, Ukraine cannot afford to ignore such an offer. The country still owes Gazprom, Russia’s state-owned gas monopoly, $3.3 billion for natural gas and its refusal to pay this debt or accept the inevitable price rises, will increase the possibility of a major disruption to European and Ukrainian gas supplies.

The EU simply does not have the means to either supply cheap gas or to provide subsidises to offset any price hikes, allowing Putin the opportunity to re-establish Russia’s influence in the long-term. Russia also has the possibility of restoring its influence over Ukraine by exploiting the country’s economic difficulties. The Association Agreement contains a Deep and Comprehensive Free Trade Agreement (DCFTA) which aims to progressively remove customs, tariffs and quotas on goods traded between the EU and Ukraine.

Even with these safeguards in place, Ukraine’s trade deficit with the EU, which in 2012 stood at €9.2 billion according to the European Commission, will most likely increase when DCFTA comes into force.

Growing trade deficit

The growing trade deficit with the EU has contributed to the country posting a record current account deficit of $16.1 billion (8.9 per cent of GDP) in 2013. On top of these desperate figures is the $13 billion in foreign currency debt that the National Bank of Ukraine (the central bank of Ukraine), the Ukrainian government, and the state-owned gas company Naftogaz must service in 2014 to avoid the country defaulting on its loans, according to the rating agency Standard & Poor’s. Only a massive long-term financial package would offset such a default and put the Ukrainian economy back on track, yet it most likely to come from Russia than from the EU.

Money is no object to Putin

Putin has made it clear that money is no object when it comes to promoting Russian interests; after all he spent between $50 billion – $51 billion on the Sochi Games. If he spent that kind of money on a vanity project, then it is safe to assume that Putin will match, and even go beyond, any financial package offered by the EU to keep Ukraine in Russia’s sphere of interest. The EU, on other hand, cannot make such decisions or commitments so easily. EU leaders have yet to decide on whether Greece requires a third bailout, over a year after it was discussed at a Eurozone meeting. If they cannot agree to fund a member state of the EU, what are the chances of a non-member state like Ukraine receiving substantial financial aid over the long-term?

Even if EU leaders agree to provide funds to Ukraine in principle, the next question will be: how much? The longer these issues take to resolve, the weaker the pro-EU movement will become. The instability caused by a delay in funding, will allow Putin to step into the breach with a financial package that will strengthen the Pro-Russian parties in the Ukrainian parliament (Verkhovna Rada), thus helping to re-establish Russia’s influence over the country.

Russia may have lost the first round in shaping the future of Ukraine, but in the long-term it may win the fight.

David Moloney is a PhD student at the University of Limerick after having been awarded a scholarship. His PhD will explore the role of MEPs, and officials from the Council of Ministers in shaping the EU’s response to the economic crisis in the Member States. David is a former employee of the European Parliament. Follow him on Twitter @Dav_Moloney

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85 Comments
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    Mute TheHeathen
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    Dec 12th 2018, 7:16 AM

    Fianna Gael, the neo-liberal party, are ideologically opposed to cheap housing. They cannot bring themselves to do it. And this is not ‘free houses’ for the ‘free house brigade’. Only the gullible are eating up that government propaganda. These are houses that are needed by the hard working middle and working classes. The housing protests are mainly about these people, the squeezed middle, the working classes who after working forty plus hours a week still cannot have their own home or even rent. We also saw during the week that the rich will be getting richer after the new tax regime was analysed, the middle and lower classes hit again. It’s a shameful indictment of this government and their supporters.

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    Mute John Hazelnut
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    Dec 12th 2018, 7:24 AM

    @TheHeathen: Wonderfully said.

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    Mute Gulliver Foyle
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    Dec 12th 2018, 8:20 AM

    @TheHeathen: obviously someone who hasn’t been too beech hill terrace… it’s like when you finally give councils a chance to build, they build grandiose council houses in the middle of centrally positioned old council estates for, apparently, middle aged taxi drivers to live. compare this to similar old council estates in dun laoghaire, where they were privately knocked and residents rehoused in medium density units, increasing the housing stock by multiples. is seems that Lacey is trying to blame a minister with national remit (albeit not delivering with the CAS) for his council not getting things done, and blaming everybody else.

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    Mute Virgil
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    Dec 12th 2018, 4:55 PM

    @TheHeathen: They’re opposed to sink estates

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    Mute Ben Dunne
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    Dec 13th 2018, 4:09 PM

    @TheHeathen: Very well put. There’s no will in this government for proper social housing,it abhors them.

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    Mute Richie Stanford
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    Dec 12th 2018, 7:20 AM

    Imagine if Labour had the housing ministry how different things could be…..Oh wait!

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    Mute John Hazelnut
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    Dec 12th 2018, 7:36 AM

    @Richie Stanford: Nevertheless, the article provides useful insights. I note how I have heard Eoghan Murphy blaming Councils recently, it’s helpful to know what is going wrong.

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    Mute Nuala Mc Namara
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    Dec 12th 2018, 8:50 AM

    @Richie Stanford:2011-2014 when TOTAL housing stock increased by just 0.4%(8,800)& homelessness grew by 81%(CSO).In 2014 there were 700 homeless children now there are 3700 homeless children ie 428%!!.
    Ireland has National emergencies in Homelessness&Housing&needs URGENT attention!There’s 70,000 HOUSEHOLDS+ on social housing waiting lists&many other people on other housing lists/housing supports including workers.Even those on higher salaries find rents a struggle&can’t buy even though paying a mortgage would be more than €1000 less a month.
    Ireland’s population is estimated to grow by 1.75m over next 33years,&if an adequate amt of housing not built now then what hope the extra 1.75m of population will be housed or in secure tenancies particularly when the next downturn happens!

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    Mute prop joe
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    Dec 12th 2018, 9:36 AM

    @Richie Stanford: Labour’s man was there for 2 years. And as much as I loath Alan Kelly he did have a major dispute with Michael Noonan in Finance about the control of housing stock. FFG want expensive housing. It suits there major donors. FG are in complete control of housing since 2011. The department of Finance hold all the strings.

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    Mute DaisyMay
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    Dec 12th 2018, 7:17 AM

    And THIS is why we having a housing crisis not because of greedy landlords or Airbnb or any other BS the government tries to sell us. Government incompetence.

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    Mute Jake
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    Dec 12th 2018, 7:31 AM

    He makes some good points but labour can never be trusted again

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    Mute Sean Conway
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    Dec 12th 2018, 7:25 AM

    Labour backed FG in government. they had a chance to make a real change in irish politics.

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    Mute John Hazelnut
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    Dec 12th 2018, 7:20 AM

    Cue the “Why should anyone get a free house when anyone on minimum wages can easilybuy one if they just work their asses off 600 hours a week like me” brigade.

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    Mute Chin Feeyin
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    Dec 12th 2018, 8:02 AM

    @John Hazelnut: cue the “everything should be free” brigade.

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    Mute MickN
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    Dec 12th 2018, 10:19 AM

    @John Hazelnut: Spot on those who choose to get up every day for little more than the spongers get the same treatment as the spongers, this is led by Leo and his posh chums , pure ignorance…

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    Mute Tom's
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    Dec 12th 2018, 7:34 AM

    FG and FF the same party both completely incompetent.There is no possibility they will sort out the housing crisis homeless crisis health crisis or any other crisis.Between the two of them they have managed to destroy this country over the last couple of decades.
    They are always only interested in the next election neither make decisions for the good of the people in this country.we need to get rid of both of them in the next election.They are completely toxic.

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    Mute Peter Hughes
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    Dec 12th 2018, 10:39 AM

    @Tom’s: They are not incompetent at all, they are keeping the rotten system in place which is exactly what they want, nothing will ever change as long as we keep voting them in. It will be just more corruption, more ripoffs, more scandals, more jobs for the boys, more cover-ups and on and on

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    Mute Michael Nolan
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    Dec 12th 2018, 8:23 AM

    They don’t want to build homes they want to build rentals for their rich friends to rent out .everything thing else is smoke and boxxox.. I will tell u 1 thing il never vote for FF or fg again

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    Mute Tom's
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    Dec 12th 2018, 4:01 PM

    @Michael Nolan: nor I

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    Mute Mick Barnier
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    Dec 12th 2018, 7:30 AM

    Incompetence is the reason. But it’s very expensive for the taxpayers and devastating for those in need and there’s no desire to sort it out.

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    Mute Sean Conway
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    Dec 12th 2018, 8:05 AM

    @Mick Barnier: There was a time when workers got raises in their wages. and tax was used to create council houses, water, bins, etc. FG are in too much of a hurry to sell off ireland

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    Mute Dave Doyle
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    Dec 12th 2018, 8:07 AM

    @Mick Barnier: Stop with this “incompetence”. FFG are the most competent government the country has ever seen when it comes to looking their interests.
    Just look at 1.9 billion tax free for vultures and PTSB.

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    Mute Chin Feeyin
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    Dec 12th 2018, 8:41 AM

    @Dave Doyle: “FFG are the most competent government the country has ever seen”

    Good man, Dave. Leo will be delighted with you.

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    Mute Dave Doyle
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    Dec 12th 2018, 10:32 AM

    @Chin Feeyin: You left out the important bit. Typical FG spin.

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    Mute Dave Thomas
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    Dec 12th 2018, 11:10 AM

    @Chin Feeyin: you totally missed his point

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    Mute Eric Davies
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    Dec 13th 2018, 12:43 PM

    @Chin Feeyin: read the last line — (its called sarcasm )

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    Mute Aine O Connor
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    Dec 12th 2018, 9:38 AM

    I know of a 3 bedroomed council house where the former tenants put in a new kitchen and left the house in pristine condition . 5 years later it was still vacant and when eventually they got round to it the Council ripped out the kitchen and put in another one.
    I know of another small one story semi detached bungalow type house that went on fire 2 years ago . It’s still there untouched. Both of these houses are in the middle of villages.

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    Mute Eric Davies
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    Dec 13th 2018, 12:48 PM

    @Aine O Connor: i know of 6 houses newly built with state of the art kitchens ,solar panels , low energy heating systems and all the latest gadgets bells and whistles — cost over 1.7 million to build them — and they are still empty !! — because the people who they were built for dont want them !!! now the problem is that because they were built as part of a program for housing ‘an ethnic minority ‘ no one else on the councils waiting list can be offered those houses – so they will remain empty !!! regulations have to be adhered too in these over bureaucratic local authorities !!

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    Mute Michael Lynch
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    Dec 12th 2018, 7:49 AM

    Bureaucracy = no accountability

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    Mute KerryBlueMike
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    Dec 12th 2018, 7:22 AM

    I thought it was the landlord’s fault?

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    Mute Chin Feeyin
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    Dec 12th 2018, 8:03 AM

    @KerryBlueMike: I thought it was all AirBnB’s fault.

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    Mute Alan Lawlor
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    Dec 12th 2018, 8:25 AM

    @Chin Feeyin: I thought it was the fault of those who don’t get up early in the morning

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    Mute prop joe
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    Dec 12th 2018, 9:40 AM

    @KerryBlueMike: the state are the landlords. Who owns the banks? FFG want expensive property. When the price was falling they thru 100 billion to prop up the price. Now prices are out of the average workers reach they do nothing.

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    Mute Hans Vos
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    Dec 12th 2018, 1:13 PM

    @Chin Feeyin: it,s everybody fault except the government and ministers.

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    Mute Brian Smith
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    Dec 12th 2018, 9:38 AM

    Too many govt dept’s, too many civil service staff waiting for retirement , too much bureaucracy , this is the problem.

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    Mute Marcus o Dhonnghaile
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    Dec 12th 2018, 11:03 AM

    @Brian Smith: Its really the only stable gig in town

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    Mute Eric Davies
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    Dec 13th 2018, 12:50 PM

    @Marcus o Dhonnghaile: what about the nativity ? thats a stable gig !!

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    Mute Frankie Mangan
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    Dec 12th 2018, 10:25 AM

    Lacey is another one with his nose constantly in the trough. He had nothing to say when his hero Alan Kelly did nothing to prevent this crisis. Lacey voted against his party and voted in favour of the privatisation of our waste services. He got made mayor after that. Lacey is not to be taken seriously.

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    Mute Dermot Lacey
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    Dec 12th 2018, 3:59 PM

    @Frankie Mangan:

    There are several falsehooods there.

    1) I did raise many issues with Alan Kelly and am delighted that it was he who pushed the Charlemont Development through and indeed his support for the Beech Hill project was crucial.

    2) If you look at my published income from DCC during this term I did not seek any of what might be called the “lucrative” roles – despite the fact that I am Group Leader.

    3)I did NOT vote for waste services privatization and indeed had my advice been followed it would not have been privatized.

    4) I was Mayor before I cast my vote in favour of Waste Charges.

    5) Ill leave the decision on whether to take me seriously with the electorate.

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    Mute Dermot Lacey
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    Dec 12th 2018, 4:00 PM

    @Frankie Mangan:

    There are several falsehoods there.

    1) I did raise many issues with Alan Kelly and am delighted that it was he who pushed the Charlemont Development through and indeed his support for the Beech Hill project was crucial.

    2) If you look at my published income from DCC during this term I did not seek any of what might be called the “lucrative” roles – despite the fact that I am Group Leader.

    3)I did NOT vote for waste services privatization and indeed had my advice been followed it would not have been privatized.

    4) I was Mayor before I cast my vote in favour of Waste Charges.

    5) I’ll leave the decision on whether to take me seriously with the electorate.

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    Mute Tom O Brien
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    Dec 12th 2018, 10:01 AM

    Simple solition. Everyones only allowed to own one house at a time.

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    Mute Mary Walshe
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    Dec 12th 2018, 12:40 PM

    That used to be the case. Back in the 80s when times were tough and interest rates sky high, local county councils were able to build social housing.
    That Phil Hogan has a lot to answer for!

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    Mute Marcus o Dhonnghaile
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    Dec 12th 2018, 11:02 AM

    Well after 2008 all the tradesmen left as they couldnt sign on. You were told to F66k Off as you were self employed even though you paid thousands in tax. We didnt have a construction industry. What would you expect ??? Anyone abroad aint coming back in a hurry as there is another dip with Brexit

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    Mute Marcus o Dhonnghaile
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    Dec 12th 2018, 11:06 AM

    Get rid of all bedsits, bring in a send tranche of building regulations and make it too expensive to build and I suppose this is what you have going forward.

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    Mute Colonel Grant
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    Dec 12th 2018, 12:06 PM

    Is it just me or is this article pursuing the same vein of what appears to be the proliferation of what I regard as. “ The Homeless Industry “ . Where are all these alleged homeless people . Not trolling by the way, a genuine question

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    Mute Annmoore
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    Dec 12th 2018, 1:34 PM

    Why did it take 7 months to get planning permission for Cherrywood in shankill area – we have a homeless crisis, can they not sit around a table and do it instantly.

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    Mute Eric Davies
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    Dec 13th 2018, 12:58 PM

    palms to be greased – brown envelopes to be sourced , bank notes to be ‘washed’ !!it all takes time !!

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    Mute Peter Byrne
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    Dec 12th 2018, 10:06 AM

    Should allow the City and County Councils get on with it

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    Mute Virgil
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    Dec 12th 2018, 5:01 PM

    I wouldn’t rely on councils/govt departments to do anything for me. You gotta look after yourself as best as you can and if not, then rely on your family. I remember going into DL county council offices at 9.30 am to pay rates and they didn’t open till 10am! I brought in an important file to another government department in the city centre at 3.30pm on a Friday. Silly me, they were closed.

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    Mute Walt Kowalski
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    Dec 12th 2018, 8:56 PM

    @Virgil: dont forget closed for lunch between 12 and 2. Its a 4 hr working day in the civil service. Throw in the 25 days annual leave and the “self-certified” sick days and it may even be less than that.

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    Mute TimBuck2
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    Dec 12th 2018, 12:42 PM

    free

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    Mute @mdmak33
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    Jan 8th 2019, 12:31 AM

    And labour party were in government 2011-16 and did not change a thing,they spent their time forcing austerity policies and water charges down the publics throat,dermot getting worried about his future.

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    Mute Liam Mernagh
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    Dec 15th 2018, 11:14 PM

    Official Ireland is alive and well and looking after it’s own vested interest, i.e. make sure the populace & politicians don,t get above themselves and interfere with iur cosy way of life. It’s time put the PS under deep scrutinyc Come on Paul Murphy, Boyd Barrett & Solidarity PBP; where are you all & your intrepid brigade??

    1
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