by NoBC4U for No Bread And Circuses For You
original link: http://bread-circuses-today.blogspot.ca/2014/07/meanwhile-back-in-kiev-and-elsewhere-in.html
Reports from various sources along with “man on the street” observations.
Sadly, in the last few weeks, there has been numerous stories about death and destruction in the east of Ukraine by the Ukrainian Army. Let’s face it, death and destruction are compelling narratives. It has often been said about mainstream media, “If it bleeds, it leads”.
In the face of the much more compelling narratives, there are other stories occurring behind the scenes. While these are certainly not nearly as compelling, this slow trickle of behind the scenes stories may in the long run be the decisive factor in the future of Ukraine.
So, let’s take a look at some of these hidden stories.
Economic stories.
Utilities…
The highly touted rising gas prices I was supposed to take effect on May 1, did not occur on May 1. It instead happened on June 1. No surprise there. May 1 was before the presidential election. June 1 was after. You always hold off bad news until after an election. But the price hike was not the 50% that was often touted in the media. Instead, the price between May and June went up almost 63%. Being summertime, this only covers natural gas used in cooking. So for most people, this is not a big hit. But just wait till October when charges for heating start to appear on the bills. Of course, I’m certain that the junta hopes that the six-month period when no heat appears on the bills will not be noticed in October when the charge for heat returns. By then, I would not be surprised if the increase is even greater than 63%.
So then, why was the increase 63% instead of the 50% mentioned previously? Well, a 50% increase was based on an exchange rate of approximately 8.5 grivnas per dollar. Since the grivna has lost value, with our new exchange rate of 11.52 a dollar, this led to an even higher increase than stated. This is because gas is bought on the international market and must go through currency conversions. I guess the big question would be since Ukraine is not paying their gas bills, why do we have to pay anything? Oh yeah, that’s right, there’s this little genocidal war going on.
The cold water rates have just risen, and man, is it a biggie. That’s up 133%! Electric is up too, but only 10%… so far. Bigger users of electricity might find their increase to be even larger.
Banking…
There have been some reports now that if you deposit money in a bank, you can expect to pay the Kiev authorities 15% up front, unless you can prove that the deposit did not come from under the table employment, or that taxes had already been paid. Somehow, I believe this will backfire and people who stash their cash in a mattress or a safe. I do remember in the past, when transferring money into the country for a purchase, that I had to declare that it did not come from employment. Now, they just take the money. Presumably there’s a way to get that money back if you’ve already paid your taxes.
Corporate Restructures…
In addition, certain companies are “restructuring” their operations here in Kiev. I have only come across a few examples so far, but that likely means that for every example I found, there were four or five or 20 others that I am not aware of.
First up is the company 4A Games. They recently announced they are moving their headquarters from Kiev to Cyprus. They did go out of their way to mention that programming and development teams will remain in Kiev. Yet, moving one’s headquarters is not a sign of confidence in the local economy. And they stated the move was to be in closer proximity to their EU client base. I assume they’re not speaking about physical proximity, though.
EPAM systems are choosing to expand operations in Poland to mitigate the risks associated with Ukraine. And Luxoft holdings plans to move 500 programming staff out of both Ukraine and Russia because of the ongoing conflicts.
And GlobalLogic is setting up operations in Kosice Slovakia, 50 miles (80 km) from the Ukraine border. Close enough to numerous locations in Ukraine for a visit home once a month. An ideal location for a homesick Ukrainian programmer.
These companies are all software related. Programming and development positions represent some of the best paying positions for talented college graduates in all of Ukraine. Their immediate loss of some jobs and the loss of future jobs that might have been Ukraine-based will be a big hit for the future of the Ukraine economy. These current and future jobs are gone and will not be returning for a long time. Consequently, some of the best and the brightest, the future of Ukraine, will leave the country for opportunities elsewhere.
I guess it’s actually justice in a way. Some companies that outsource IT work to Ukraine are PepsiCo, IBM, Ford, Chrysler, and Dell. While the US government will certainly not sanction the Nazi government here in Ukraine (preferring to sanction Russia instead), these major corporate outsourcers would prefer stability, and that is unlikely to return to Ukraine for very long time. So in effect, these companies are implementing the sanctions that the US government should, but will never do.
It is still too early to tell the effects this will have on my wife’s business. She supplies medical services that, while provided by the government for free, are much more appealing and convenient for those who have the means. But it’s likely that quite a few that have the means today will not have the means a couple of months from now. The business really slow down in the months of April and May, but have recently picked back up again, probably because enough people believe the election of a new president means a return to normalcy. But normalcy is a relative thing these days…
Refugees from the East.
I have heard several reports about refugees arriving in Kiev from the East. Some are no doubt professionals, competing for positions in an already depressed job market. Numerous others are at the lower end of the scale, looking for jobs as drivers and household help. Those who know some English will likely be better off; those that don’t likely to end up very disappointed and unemployed for the long term. And government austerity is likely to hit those that are not employed immensely.
Weather related economic hits…
With cooler and wetter than normal weather in the central region this summer, a number of crops are likely to take major hits, even if the weather quickly returns to normal. A long-term area resident (70 years) doesn’t remember any summer quite like this one. Potatoes, one of the major staple foods, is likely to show a major decline. It’s important to remember that even with the loss of Crimea, Ukraine remains larger than the state of Texas, so in normal years this could be overcome. But with war out east, agricultural output in the east is down too.
Agricultural output in Crimea took a hit too because Ukraine cut off a major water supply route to Crimea. And it’s also likely that agricultural output of Crimea that in the past would have benefitted Ukraine will be used for Crimean and Russian needs first, including the 500,000 estimated refugees from the war in east Ukraine now living in Russia. Ukraine should probably not expect too much help on that front.
Other economic activity depressed.
During the so-called “revolution,” the overall economy if Ukraine didn’t seem to be hit all that badly. But the month of April showed numerous large decreases in numerous sections of the economy. In the month of April alone, certain sectors showed drops in the range of 10 to 25% in one month! So it looks like Ukraine is going down, and it’s going down hard.
Timothy Ash, writing in the Kyiv Post, says this about economic activity in Ukraine so far in 2014.
- “Herein, the overall production index dropped by 6.2 percent year-on-year in April, from the 3.4 percent drop in March, and within this chemical production dropped by 23.3 percent, engineering by 18.9 percent and metallurgy by 12.8 percent.
- This fits in with anecdotal reports of strikes/disruptions to various production facilities in Donetsk and Luhansk and also to transport services, particularly rail transport.
- Plants across Ukraine may now be struggling to receive parts from operations in Luhansk, Donetsk and even Crimea. A Kyiv Post report yesterday suggested significant problems emerging in the auto sector.
- All the above would tend to suggest a more precipitous fall in economic activity is under way – perhaps more in line with recent European Bank of Reconstruction and Development/Moody’s forecasts for a 7-7.4 percent real GDP decline this year.
- The latter, if delivered, would make adherence to IMF targets that much more difficult, and “recalibration” of the IMF programme that much more likely later this year.”
Needless to say, this is an enormous economic hit to the economy of Ukraine. And it is not one that Ukraine will soon recover from.
Stores closing.
So far, there have been a number of store closings on Khreschatyk, the main street of Kiev, and indeed, all of Ukraine. I’ve counted around 20 so far, but I have not visited a number of the side streets. First, a good portion of Khreschatyk is still closed to vehicular traffic and remains a tent city, mixed with a large dollop of circus freak show and hawkers of souvenirs weird and strange. So it’s quite possible that it’s no longer profitable to have a store on “Main Street”. My guess is that retailers who have leases coming up for renewal are not renewing at this time and as time goes by, more retailers will join the act, either because of lack of faith in the economy or the hope that in a year or two or three, they may be able to return to a much lower lease and a much better economy. But most of these retailers have other locations throughout Kiev, so it’s not a mad dash for the exits yet. But the continued presence of the Maidan does not help; the Globus Mall, built under Independence Square had foot traffic, a few days ago, 70% less then I’ve ever seen it before, plus a number of empty storefronts, something I’ve never seen at this location.
Shortages:
While the price of a whole lot of items have increased, largely because of currency devaluation, most items are still available, at a price. Remember that currency devaluation mostly impacts imported goods. The major exception is a number of Russian made items, some because of trade sanctions, and some because the demand just isn’t there anymore. Others are a bit more worrying.
Salt (except for sea salt) basically disappeared from store shelves in Kiev for a few weeks. The reason? At least some of the salt in this part of the world comes from Slavyansk, until recently under control of the anti-fascist forces. And even more comes from Crimea.
Some medicines, especially those that are imported, can be in short supply. I’ve told my wife to always have at least a month’s supply of important medicines, which might have not been enough, since one of her medicines disappeared from shelves for a few weeks. It is now back, and we currently have a 3 month supply. But medicines, especially imported ones, will likely be in short supply because of the logistics of shipping into a dysfunctional country, along with price increases putting these medicines out of the reach of a good number of people.
Commentary:
Yet with all this, I’m still surprised at how little has changed. So far. Grass is still being cut, (some) road maintenance is still being done, the water fountains are dancing merrily as if it was still 2013. So, what might be the reason for this?
Since I’m reporting from a decent enough neighborhood, I first attributed it to city leadership keeping up a façade so that they could extract higher taxes later. But, it actually seems a bit more basic than this. And also a bit more obvious. It’s so basic and so obvious I’m surprised it took me so long to see it, and am surprised it’s taking other commentators so long to see it. Here’s how I see it playing out.
First let’s take a quick look at what the IMF actually does. What it does is it works with a government and together they declare war on the people of the target country. In simple terms, that’s really what the IMF does. When the IMF rolls into a country, whether South Korea, Argentina, Russia, or any number of others, it sets up targets for economic reform that are most likely going to be difficult or impossible to achieve. Once compliance does not happen, they rape and pillage the economy, in line with the negotiated terms. Their stolen loot is then given away at a fire sale to those who can “better manage it”. It’s “steal from the 99%” and “give to the one percent”. It’s a class war where the 1% comes out on top, as they normally do.
Now in most IMF interventions, the IMF is the primary intervener., many times the only one. While there may be other social and political goals, the economic goals of the IMF reigns supreme. But is this the case in Ukraine? Looking more closely, it’s clear that there are several other major players involved in the Ukraine fiasco. And these players have goals of their own. In the case of Ukraine, the primary intervener is not the IMF. That “honor” goes to the State Department and the CIA. From what we have seen so far in 2014, the goals of the State Department and the CIA will take priority over the goals of the IMF. So then, exactly what does this mean going forward for Ukraine?
The goals of the State Department and the CIA so far all clearly pointing to trying to provoke Russia to invade Ukraine. So far, they have not had a lot of success meeting this goal. But should they be able to provoke Russia to protect Russian people in the east of Ukraine, it will provoke a larger war, Russia on one hand, versus Ukraine and NATO on the other hand. A war of country versus country and its allies. Now, remember back a few paragraphs where we discussed the modus operandi of the IMF. With IMF’s help, a government declares war on its people. The State Department and the CIA are attempting to provoke an international hot war involving Ukraine and Russia. Now, while it might be possible for a government to have both a war with a neighboring country and with its own people at the same time, I really don’t believe you’re going to see that here. The war that will be given priority will be the war with Russia, should that occur. Consequently, when support for the international war, the war with Russia, you will see programs implemented to build support for that war. Austerity will lead to a major lack of support for said international war, and will therefore be against the goals of the State Department and the CIA. So, will the IMF be left out in the cold, with the bill to be paid by NATO, EU, and USA tax payers? The IMF will no doubt still push through what it can, but if some action leads to major pushback by the citizenry, the IMF may possibly let Ukraine slide on a few. I say possibly because the government still has their means of enforcement, Right Sector.
So for Ukraine, it’s the ultimate lose-lose situation. Should the state Department and CIA get their way, Ukraine will be ground zero for a major land war. If Russia should manage to tie their hands, and war is prevented, Ukraine will be socked by a major IMF austerity plan, made worse by the loss of Crimea and possibly other areas of Ukraine, and made even worse by the debts incurred trying to provoke said war, which will be thrown on the backs of those Ukrainians who stick around for the punishment.
Am I being a bit too optimistic here? Possible, but only time will tell. My guess is that the State Department and CIA goals will get first priority and if that means suspending some IMF goals to garner public support, that will happen. Anyway, that’s the way I see it now.
Now that the Ukie Nazis are shelling Russian territories, would it be possible for Russia not to be sucked into the CIA-trap? The question is, how far the CIA/Nazis are prepared to push in order to provoke Russia into this conflict? By now, the majority of Russian leaders know what this whole “freedom” fighting is all about but I’m sure CIA is not exactly napping without plan B,C,D,F etc, etc…
Looks like another major defeat for the banderivtsy quisling army:
The war in the South East Online 13.07.2014 Chronicle of events (post updated)
http://translate.yandex.net/tr-url/ru-en.ru/voicesevas.ru/news/yugo-vostok/2762-voyna-na-yugo-vostoke-onlayn-13072014-hronika-sobytiy-post-obnovlyaetsya.html
(trans adjusted for better comprehension – hopefully correctly)
“The militias DND surrounded and destroyed convoy guards near the town of Snow. The soldiers were riding in armored vehicles and trucks in Alexeyevka. In the result of the battle junta has lost 27 vehicles. Information was confirmed by the commandant of the Snow Evgeny defect. According to him, the convoy was surrounded in the area Marinovka and barreled artillery was also destroyed. Three cars managed to escape from the zone of fire, but at the turn one of them turned over.”
вот так
re: Economics: Thank you for the very informative analysis. There is an interesting article stuck in a corner on the World News page of 7/12-13/14 Wall Street Journal: ” A key ally of Russian President Vladimir Putin and target of US sanctions over Ukraine has joined the board of Pirelli &C., one of the world’s biggest tire makers. Igor Sechin, president of OAO Rosneft, Russia’s state-owned oil giant, will take a board seat along with two other Rosneft representatives… just months after Rosneft agreed to take a major stake in the company.” and the article continues..: “His appointment to the board of one of Europe’s best known businesses underscores the limited effect Western sanctions generally have had on circumscribing Russia’s global economic and business interests.” then some more blah, blah Again: ” BP and Exxon Mobil Corp have both said they would continue with big projects planned in Russia, both in concert with Mr. Sechin’s Rosneft.”
Hmmm…looks like one arm of the American ruling class is going about its business as usual or it is just saying ” yo mama!” to the spooks in the CIA and State Department or they are bad cop/good cop players together or all of the above. Jeez, and the Ukrainians are getting the raw end of this shell game ( no bad pun intended)–hey, if Amnesty International says it is a war crime to shell civilians in Gaza, well, it is the same crime in Donetz! Come on guys, speak up!!!
The EU and the US “broke” Ukraine. Now they own it (along with the IMF which is controlled by the EU and US.
Russia wanted Crimea- navy base, oil and other resources, less than two million people who want to be part of Russia, etc.
Russia did not want any other part of Ukraine- its broke, its run by a small group of kleptocrats who own everything that’s worth very much, it has over 40 million people many of which hate Russia, its old factories would be better closed and replaced by new ones in Russia, etc.
The US, EU, NATO do not want Ukraine either. They can put missiles in Latvia or Estonia, or on ships in the Baltic and Black Seas. They will have to spend at least $3 billion a month, forever, just to keep Ukraine from collapsing. NATO does not want the ownership of a failed state in Europe.
The NATO plan A was to kick Russia out of Crimea. After that failed plan B was to coerce Russia to invade Ukraine so they will then own it and NATO can blame it all on Russian aggression. Russia will not invade because of the cost in money and lives of a prolonged civil war.
I believe that we are now at NATO plan C. This involves supporting the Rebels so as to keep them from collapsing and gradually withholding money from Kiev until their government fails. It appears that NATO is helping both sides which seems to be a standard operating policy for them.
Remember, there is no real evidence that Putin has ever sent any military or financial aid to the rebels. Where are they getting the money to buy Ukrainian government military equipment? How are the Rebels paying the Militia good wages? Why would Russian banks risk sending money? Sanctions?
Putin has always insisted on a federalized Ukraine and he told the Donbass not to have the referendum. He does not want an independent Novorussiya, but NATO does as this will stick Putin with at least part of Ukraine, and they can still blame it all on Russian aggression.
The question is when will the Ukies finally realize that their friends are now trying to destroy them? Then what will they do- maybe attack Crimea and the rest of Russia?
“США активно снабжают хунту вооружением. В частности, в н.п Майское (Днепропетровская область) проходят летные испытания 4 вертолетов “Аpache”.
Наши уже готовят иглы, коих теперь в избытке. Живучесть у них намного хуже чем у такой огромной живучей коровы как ми-8.”
“The United States is actively supplying weapons to junta. Specifically, in the May NP (Dnipropetrovsk region) undergoing flight tests four helicopters” Apache “.
Our already preparing needles, of which is now in excess. Survivability they are much worse than enduring such a huge cow as the Mi-8. “
The Defense forces are rolling out victories in the face of incredible odds: Reports are that Novorossian forces have taken and are holding both the Donetsk and Lugansk airports.
Also – it seems that they’ve managed to surround Ukie forces that had been squeezed into a “pocket” by the Russian border, and are making short work of them. Here’s a map to give you an idea of what’s going on there.
Major, major victories. I’m in total awe of these guys.
:-D
Odessa – antiwar flashmob, two branches of Privatbank blown up.
UA ‘Army’ has yet to score a single victory from start of ATO.
Will the hard right overthrow the junta, or keep them around as a stage prop to attract Western funds?
Guerilla activity in Kharkiv and Odessa on the horizon.
I’m not so sure waiting for the ukieland economy to crash is a reliable strategy. Strangling economies rarely succeed in toppling regimes or causing a country to collapse from its own weight. Iran and Cuba are prime exhibits in this regard, and so is the USSR during the great patriotic war. If anything, wartime environment and political atmospherics make the citizenry more tolerant of draconian economic and political conditions than in peacetime. No one complains about steaks and lobsters when their minds are focused on survival- and war focuses the mind like nothing else on survival. Look how much Novorossiya’s newly minted citizens put up with in Sloviansk and still did not revolt against Strelkov and the leadership.
Besides, the economic isolation would have to be total to even be marginally effective. With access to financing and resources from the west, and even Lukashenko reluctant to freeze trade relations with Kiev, a strategy of achieving Banderistan’s termination through economic strangulation is dead on arrival IMHO. It would be safe to assume that whatever hardships Novorossiya can endure, despite near total economic and governmental isolation from the west and only clandestine support from mother Russia, banderistan can withstand twice as much, because the war only a distant echo there, as far as the average citizen is concerned
Very informative and well written. Nice job NoBC4U.
I am curious about one thing and that is the coal mines. Why are they being targeted? Is it just to destroy the local job market to drive more people out of the area? Does this have anything to do with energy supply? I am puzzled on that one.
Here are a couple stories posted at that deal with the economic side in Uk.
english translations…
Europe refused to buy Ukrainian products
Naftogaz stops gas supply their debtors
Here is something disgusting if you look deeper into the story.
Yatseniuk: Ukraine should be world leader on food market
What you are seeing there is the start of the GMO marketing pitch for Rockefellers control of Uks farmland.
and the lies keep coming… look how the blame is put on the “illegal armed groups” for the loss in gas to cover the price rise.
Ukrgazvydobuvannia losing up to 200,000 cubic meters of gas a day
Anyone paying attention to the big picture knows the Uk. takedown has much to do with the ‘so called’ free trade pact the US is trying to pass with the EU. Take a look at this jewel…
By U.S. law LNG can be exported without any volumetric limits to countries that have a free trade agreement (FTA) with the US. Countries without an FTA agreement can also receive LNG from the US, but companies that want to export need to go through a lengthy and costly permitting process with the Department of Energy (DoE) and then the Federal Energy Regulatory Commission (FERC).
(warning, 90% of this is propaganda)
The 2014 Ukraine-Russia Crisis: Implications for Energy Markets and Scholarship
can anyone in the State Dept. spell coercion?
and keep your eyes on this…
Russia to suggest forming energy association, fuel bank at BRICS summit
Ukraine Turf Wars, Kolomoisky vs. Poroshenko
A link to an interesting article about mainly Igor Kolomoisky, the wanted Jewish criminal living in Switzerland but somehow manages to be Dnepropetrovsk governor.
It also mentions the idea that has floated around before that Israel wants Ukraine to be another home for the Jews and this savages might be the man to do it.
I would say there are 2 distinctly different economies in Ukraine: People’s and Elite. The Elite is the economy that won’t crash, whereas the People’s will. Why? It’s a cash economy; the elite have access to plenty of cash and can thus stay afloat, while the people don’t. Inflation of basic goods beyond the ability of the People to pay will cause their economy to implode, and that’s what Austerity aims to do. As elsewhere in the EU, the labor market will dry-up–look at the Baltic nations and Greece–while the cost for basic goods soars.
IF it was a war dictating the need for austerity, people are likely to accept shortages–except that it isn’t, nor is it causing the evaporation of the labor market. For the majority of Ukrainians, the war for them is a lead balloon, and migration’s already happening. This is bound to increase as conditions worsen, which they surely will.
It will be the Winter War that produces a winner. Is there enough wood remaining in the Carpathian mountains to heat the homes and run the businesses of western Ukraine? What will they use as money to buy foodstuffs? March 2015 will mark one year. I doubt the current junta will remain in power as the people will overthrow it.
nice to get this inside story from Kiev – hope our correspondent and his wife stay safe, first, and keep the stories coming, second. Thanks for republishing, Saker.
NoBC4U
Thanks for the excellent and comprehensive report.
Is there any news of Kolomoisky? My impression is that he is seeking to gain control of the south-east (effectively Novorossia) as his own personal fiefdom. My understanding is that the major part of the first tranche of IMF money ended up being parked in his Privat Bank. He also seems to be interested in destroying assets of other oligarchs in the area (Ahmetov?). He has been running a private army for some time, though that may be somewhat smaller than it was, given the recent successes in the south east corridor. He also seems very keen on getting Ukraine fully into the EU so the repatriation laws (or whatever the correct term is) can be used to recover property allegedly taken from Jews in the past.
Is this scenario likely? Perhaps he sees himself as being the successor to Poroshenko, after he has served his purpose?
Sounds like the past 48hrs have seen very intense fighting. ITAR-TASS is reporting that the militia have taken Lughansk airport and that the aircraft that was seized last week has been used to destroy some armor – 6 tanks and an APC. Also reports of another 300 surrender down in the sasuage. Some report that earlier a militia transport truck was hit with mortar fire and 30 killed.
Would be nice to get a comprehensive report Monday from DPR/LPR people. They seem to have had some success but the opposing forces are pretty large. Clearly a different situation since the regrouping of forces – Porky can’t be pleased with how his ‘victory’ in Slavyansk is turning out.
NoBC4U
I agree the others, great job putting the info together. Thanks.
вот так
I have been looking for stories of economic decline as a result of this Civil War
Questions for the experts:
1. Are Porky’s chocolates selling in Russia
2. Has there been a Boycott Divest Sanction effort in Russia against Ukrainian goods and services. Esp. those controlled by the fascist Oligarchs
3. If Ukraine joins the EU will their goods be subject to Russian tariffs
4. Will Ukrainian workers in Russia be sent home
This report seems to downplay a couple of obvious possibilities. One is that a guerrilla war of sorts will spread. So bridges, railways, and important infrastructure might have problems. The other is gas. Are they going to have enough in Winter to keep things going?
Seems kind of simple to me. The economics of the situation is that US/EU/IMF-backed corporates will squeeze every last resource out of Ukraine, leaving its people destitute.
What is being gained here are incidental riches accumulated while achieving its main objective of stationing Anti-Ballistic Missile batteries on the border to force Russia’s surrender. If Russia doesn’t surrender or wants to prevent such deployment, it has to strike militarily, which will lead to a war with unknowable consequences. The conventional forces of NATO are 14 times larger and much more modern than Russia’s. Russia’s only real deterrent are its nuclear weapons which the ABMs aim to neutralise.
The complete destruction of Ukraine is an acceptable outcome in this scenario. After all, the Allies can simply blame Russia for everything as they have done so far, and who would be left to gainsay such an accusation? Certainly not the Western MSM.
First, my thanks to Saker for giving this information wider distribution. It’s much appreciated.
Second, let me answer a few questions that arose to the best of my ability, of course…
From the original Paul:
The best I can tell about the coal mines. Russia had a number of such mines too, many which no longer operate because they were uneconomical. However this plays out, they will be future money losers. Because they are money losers today. So they may just be trying to drive people out, especially given what’s written in this article…
http://bread-circuses-today.blogspot.ca/2014/07/olga-chetverikova-donbass-russians.html
and also
http://bread-circuses-today.blogspot.com/2014/05/r-hunter-biden-should-declare-who.html
from Yonotan:
Correct, about Kolomoisky’s PrivatBank
http://bread-circuses-today.blogspot.com/2014/06/stress-test-for-imf-in-ukraine-igor.html
I haven’t seen anything “official” about this, put apparently Kolomoisky is cooking up a scheme whereas all Oligarchs in Ukraine except him and Poroshenko will be declared “separatists.” This way the two of them can split the spoils. And if Poroshenko doesn’t go along with this? Well, Kolomoisky will cook up another Maidan, topple Poroshenko, and install Tymoshenko in his place. Is that even possible? Well I guess anything is possible when the circus comes to town.
One would hope that should Ukraine ever gain EU status that Kolomoisky would be arrested as a war criminal. But he likely understands that’s decades away and he’ll be dead and gone. Though sometimes I think he understands anything besides raw power.
from Robert Nelson:
Roshen news:
Russia has seized the Russian factories of Ukraine’s leading chocolate company Roshen. A trademark dispute apparently.
http://www.confectionerynews.com/Manufacturers/Chocolate-war-Soviet-brand-dispute-behind-Roshen-factory-raids
About boycotts of Ukrainian goods
my understanding is yes, there are boycotts. Both in Russia and in Ukraine.
Ukraine, EU and Russia:
Even under the Association Agreement, which is nowhere close to EU membership, if Russia did nothing, it would set up a situation where the EU could import their goods into Russia duty-free, because Ukraine and Russia currently have a duty-free border. This would cause job loses in Russia while allowing Ukraine to also pass along some of their job loses to the Russian economy. Putin has been clear from the beginning that once the Association Agreement takes effect, the Ukraine/Russia duty-free border will be closed.
Ukrainian workers in Russia;
Have not heard anything official on this, but I would not be surprised to see Ukrainian workers sent home. There are now a lot of Ukrainian refugees from the war who will not be returning to Ukraine anytime soon. They will need to be integrated into the Russian economy at least for the time being. Refugees from the war will likely get a higher priority.
To the best of my knowledge Roshen brand candies are not being sold in Russia, the ban still in place.
To the best of my knowledge there has not been actions against Ukraine from Russia. It may be that with the joining of the EU customs union that Russia may need to set up tariff barriers to protect the Russian market. This has not yet happened but is a normal step in the case of a country joining a customs union. The union protects those within the union against the ‘outside’ but also the ‘outside’ needs to protect its own markets and so long term trading relationships may be forced to change.
There is no likelihood that Ukraine will join the EU within the next generation, perhaps longer. With regard to tariffs as a result of joining the EU customs union please see above.
Moscow has made the point that Ukrainian guest workers may be sent home, that has not yet happened but would be a sensible move for Russia to make. However, it may suit Russia’s purposes to demonstrate to the Ukrainian people that Russia offers significant advantages that the EU does not – there is no likelihood that Ukrainian workers will be able to go to work in the EU in a similar manner to which they do in Russia. Right now, there is no concrete plan to even enable visa free access to the EU.
It is important to understand that the EU association agreement is NOT EU membership, it is not even a step toward EU membership. The association agreement is, in essence, a tool to enable the EU and those blocs with whom it is aligned, to have free access to Ukraine assets and to have a significant degree of control over Ukrainian legislation.
Seems the anti-Russian hysteria in the Western media has been further dialled down a notch (even the normally Russiaphobic Economist has a mildly sympathetic story for the travails of East Ukrainians)
http://www.nytimes.com/2014/07/14/world/europe/first-self-declared-wedding-in-donetsk-peoples-republic-ukraine-rebels-make-love-not-war.html?_r=0
http://www.economist.com/blogs/easternapproaches/2014/07/war-ukraine
—From Naijaa_Boy
the original Paul:
I am curious about one thing and that is the coal mines. Why are they being targeted? Is it just to destroy the local job market to drive more people out of the area? Does this have anything to do with energy supply? I am puzzled on that one.
The coal mines support the Donbass steel mills and coke works and are used for electrical generation for other Donbass industries. They are alleged to be uneconomical because Akhmetov and others have long used a higher than market price supported by government subsidies as a way to generate additional profits from their enterprises as well as employ many needless laborers when compared to forieng rates of productivity in America, Russia, Germany, or Australia. There are also many “illegal” private coal mines in Donbass where the product is sold for 1/2 to 1/3 of the official price. The fact that these operate at all show you what the coal mine subsidy scheme is really about.
By targetting the coal mines and destroying them, Akhmetov’s mills will be impacted and possibly forced to close, leaving people in Donbass in unemployment and turning it into a new Youngstown (Ohio) while at the same time raising the value of the steel enterprises owned by everyone else. There is too much steel mill capacity in the world and especially in Ukraine, which hardly needs the level of steel production it has for domestic purposes.
In a bigger picture, a number of Ukrainian oligarchs are far more interested in selling iron ore pellets or just raw steel slabs abroad, and not finished steel products. A major pro-Maidan example of this is oligarch Kostyantin Zhevago and his Ferrexpo company. It must be understood that about 50% of the Ukrainian steel industry uses the sort of obsolete open hearth furnaces which were closed in the northeastern and midwestern US in the 1970’s and 1980’s, while almost 80% of Ukrainian production is exported. The industry itself is divided between Dniperopetrovsk and Donbass.
The Ukrainian steel industry is controlled by major multinationals Arcelor-Mittal (Luxembourg-India-America) and Evraz (Russia-America) who you must understand will not be permitted by their governments to be squeezed out of the market and have the financial wherewithal to recapitalize their plants in Ukraine (in Kryvyi RIh and Dniperopetrovsk respectively) to exploit the major native iron ore resources, and the major oligarchs Akhmetov (Mariupol/Yenakiyeve), Kolomoisky (Dnipropetrovsk/Stakhanov/Zaporozhia), Pinchuk (Dnipropetrovsk), Taruta (Alchevsk/Kramatorsk), and Shifrin (Zaporozhia). Akhmetov is the biggest player among the oligarchs, but he also has the weakest political position, has the plants furthers from the iron ore in Kryvyi Rih and Poltava, and the most obsolete plants.
The entire world steel industry is oversupplied when one compares prices received to costs of production would love nothing more than to see someone like Akhmetov and Metinvest go bankrupt and their holdings and mills be liquidated, reduced, or scrapped. This war serves many purposes, and Akhmetov has got to wake up and see where the winds or blowing.
Remember if the SHTF who are your enemies .
The state of Israel , the City of London , The Windsors family , Wall Street , the Vatican , Bruxelles .
Lets hope that common sense prevails in Washington .
Best of luck . Best wishes to you and your family .
enemy of the NWO
Putin Hold All the Cards
July 14,2014
Excerpt:
“Don’t hold your breath for Putin to back-off or back-down, he has put down his marker and is now playing both Obama and Kerry for fools in a contest that cost Russia little. It is likely that if Putin doesn’t get his way next week he will next month or next year at the latest.”
http://brucewilds.blogspot.com/2014/07/putin-holds-all-cards.html
Isn’t it awful when your utility company or bank calls you just when you are trying to get through security at some international airport.
This video will make you ROFL your ass off.
Call from the Bank – Donetsk Airport
What to tell your bank whan they call you about your overdue loans? – With the Vostok Battalion at the Donetsk Sergey Prokofiev International Airport
(Select Captions for English Subtitles)
From USSR to failed state, a devastating account of the decline of Ukrainian industry.
Ukrainian engineering: Requiem
http://translate.yandex.net/tr-url/ru-en.ru/voicesevas.ru/news/yugo-vostok/2810-ukrainskoe-mashinostroenie-rekviem.html
“You remember, how everything began?
The independence of Ukraine met with powerful engineering. As at 1984 engineering was the leading branch of industry by the number of employed workers, the number of which amounted to 28.3 per cent of all workers. In 1990, engineering he held 30.5% in the total volume of industrial production of the Ukrainian SSR. The Republic produced 100% of the Soviet bucket wheel excavators, Kukuruza – and sugar beet harvesters, 95.4% of coal cleaning combine harvesters, 40.5 percent domain and steel-smelting equipment, about 47% of power transformers, 33.8 percent of rolling equipment, 24% of large electric machines… At the moment the share of machine building in Ukraine’s economy fell to 12%, the number of employed in the sector has decreased four times. Research in machine building consumes only 0.1% of GDP. needs updating.
Ukraine lost the whole industry industry. This applies to most science-intensive and high-tech sectors as production of computer engineering, automation, robots, etc. Ceased to exist agricultural machinery. Compared with 1990 volumes of manufacture in industry decreased by 87% in the General level of its fall in mechanical engineering at 63%. Almost 20 times decreased production of tractors, almost stopped production of sugar beet harvesters, 17 times decreased production of ploughs, 50 times reduced volumes of manufacture of machines for fertilizer.
Neo-fascist coup that occurred in February 2014, dealt a severe blow to the machine-building sector of the economy.
According to the state statistics service of Ukraine, the decline in production in the engineering industry in March 2014 was 17.4%. The production of computers, electronic and optical products decreased by 24.3%, machinery and equipment for General purposes – by 10.8%, machinery and equipment for mining industry and construction – by 5.6 %, agriculture and forestry – by 15.7%.
The greatest losses in transportation engineering, which from the beginning of year has decreased on 32-36%, and the building has cut output by 81%. At that, the decrease in the production of “Azovmash” has made 85%, Krukovka – 80,6%. According to the analyst of investment company “Art-capital” Aandreea, the reason was the fall in demand from Russia, previously purchasing 80% of production of car building works.”
That’s just a little bit of the article.
вот так