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Battle for Ukraine
Ukraine in Dispute with the IMF

Ukraine’s lawmakers appeared poised to reject a long haggled-over tax overhaul plan today, after a compromise seemed within reach last week. Officials from the IMF warned that if Kyiv was unable to pass the measures, further disbursements from the Fund’s $17.5 billion bailout program could be endangered. The most recent $1.7 billion disbursement is already being held up by the ongoing impasse.

In other news, two days after the IMF ruled that Russia’s $3 billion bond to Ukraine was in fact sovereign debt, and that Kyiv must make a “good-faith” effort to renegotiate its terms with Moscow, Prime Minister Arseniy Yatsenyuk announced that his country was ready to fight in the courts and would thus not be making payments on the debt until Russia accepted the terms previously offered. (The Finance Ministry sounded a slightly more conciliatory tone, saying it was still open to good faith negotiations with Russia.) The bond comes due on December 20, but Kyiv will not be in official default until 10 days later, when a grace period expires.

A Ukraine–IMF dispute represents a big win for President Vladimir Putin. Those who think Putin’s goal has been to annex Ukraine or reinstate a pro-Russia government might think he has not been all that successful. But that’s not really what he’s trying to do. His goals are more limited: He wants to have the ability to create unrest at any moment. Russia can’t afford an expensive operation in Ukraine, but it doesn’t need one if the goal is influence and instability—and a dysfunctional Ukraine. And on that front, the Kremlin continues to succeed marvelously.

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  • Andrew Allison

    Putin is getting all the help he needs from the idiots now running Ukraine.

  • Максим Мелешко

    Oh my God … “Russia can not afford to carry out the operation in Ukraine ….” If Russia wanted to a week occupation of the whole of Ukraine. Just the whole question is that whether the world is ready for nuclear war. Government bastards in a pile of US staged a coup … Ukraine has become a red line. World on the brink of nuclear war. Russian We will not deviate from what we consider our.

  • Dmitry Fedotov

    Ukraine has no economy, ucranian politics are thieves, people do not like to work since Soviet times. Even if Putin will disappear tomorrow, it will not slow down collapse of Ukraine even for a second. There is only one way to save Ukraine. Some of us have to feed it. Russia, US, EU. We (Russia) are not going to feed her animore. Once they became micro Nazis, we do not love them anymore.

  • Андрей Колчин

    Americans wonder why wherever they appear remain the ruins, blood, chaos, drugs and terrorists? Now they went to Europe.

  • Cool Pool

    Putin is gradually turning into an all-powerful god!
    Who wrote this article?
    Author of the article, you crazy?

    Ukraine is similar to Poland, and Poland received 400 billion USD loans, which she can never pay – because of this, Poland is very fond of the United States.
    Ukraine needs the same amount of money. Initially, representatives of the American political elite promised Ukraine 70 – 80 billion USD per year, plus a cheap American liquefied gas – the promises were not fulfilled.

    Now Ukraine has received from the IMF is very little money in exchange Ukraine has to completely destroy its economy – all economic indicators have declined in 2, and even more times, with respect to the reign of Yanukovych.
    The Ukrainian government has reached the limit of stability of the system, so they need a revision of the terms of the loan agreement. From the outset it was clear that the conditions of the IMF can not be done, but with the help of propaganda, as well as the assassination of opposition politicians managed to control the situation. Currently in Ukraine, few people believe in aggression of Russia, the population requires a real improvement in the economic situation.

    The solution for the Ukrainian government could become a continuation of the war in the east of Ukraine, but they have twice been defeated if he loses in 3rd time, the rebels occupy Kiev, with the support of local people.

  • Alexey Strelkov

    “the goal is influence and instability—and a dysfunctional Ukraine” – no, the goal is to get our money back. 3 bln is not some pocket change and we gave Ukraine enough time to get its finances in order. We even proposed to split it into three annual payments, provided the EU or US or IMF agrees to be a guarantor.
    But since no one is stupid enough to vouch for Ukraine, we have to go to court now.

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