Ukraine Live Day 493: A ‘Big War’ And Financial Default On The Horizon?

June 25, 2015
A Ukrainian soldier in Shirokino, Ukraine | Patrick Wells, Channel 4

Yesterday’s live coverage of the Ukraine conflict can be found here. An archive of our liveblogs can be found here. For an overview and analysis of this developing story see our latest podcast.

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For the latest summary of evidence surrounding the shooting down of flight MH17 see our separate article: Evidence Review: Who Shot Down MH17?

Police Chief In Donetsk Warns That Russian-Backed Separatists Are Cracking Down On Dissent

Vyacheslav Abroskin, the police chief for parts of Donetsk which are currently occupied by Russian-backed separatists, has warned that the separatists are cracking down on those who protest against their rule. Kyiv Post reports:

Abroskin’s allegations point to a possible crackdown on residents who spoke out against the separatist leadership in the first popular protest in occupied territories on June 15.

Abroskin posted photos taken at a recent anti-war rally in Donetsk where he says eight different men who “violated their oath” to Ukraine were spotted watching over the crowd. Having been fired from the Ukrainian police force late last year, they have all now turned up in the occupied territories, apparently working for the separatist police force. Photographs published by Abroskin show the men looking inconspicuous at the recent rally, apparently watching over, with at least one filming, demonstrators.

“I am appealing to peaceful citizens of Donetsk. Beware, you may have a field surveillance team from the so-called (separatist) police force following you with the aim of subsequent reprisals,” Abroskin wrote on Facebook on June 22.

“Nikolai Kryuchenko, the current separatist deputy interior minister, gave an order to his employees to tail the demonstrators and determine their identities in order to punish them later,” he said.

​Citizens who criticize Russian-separatist leadership in Donetsk get tailed by police

Residents living in Russian-occupied Donetsk who criticizes the Kremlin-backed leadership are closely monitored by the separatist police for "later reprisals," according to the police chief of Ukrainian-controlled parts of Donetsk Oblast. Those conducting the surveillance are former Ukrainian police officers who defected to the Russian side, Vyacheslav Abroskin announced on his Facebook page on June 22.

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Jun 25, 2015 23:17 (GMT)

James Miller
Russian-Backed Militants Blow Up Smokestack Art Work in Donetsk
Ukraine May Default On Debt Payments As Early As July

Ukraine has continued to struggle to reach a negotiated deal with its creditors and may default on its debt repayment as early as next month. Bloomberg reports:

The government is unlikely to resolve a disagreement with its creditors on its debt-repayment plan in the coming weeks and will probably issue a moratorium before a $120 million coupon payment comes due on July 24, analyst Andrew Matheny wrote in a research note on Wednesday. Ukraine is giving creditors a few weeks to accept a proposal that includes a 40 percent writedown to principal before it imposes a debt moratorium, a person familiar with the talks said on June 19.

“Ukraine will not make the July 24 coupon payment and, as a result, will enter into default at that point,” Matheny said of his base-case scenario in the report. “We do not expect the ad hoc committee to accept Ukraine’s latest restructuring proposal.”

Members of the committee, the government and the International Monetary Fund will meet in Washington next week as the crisis lender weighs whether to issue the next slice of a $17 billion loan to Ukraine. The IMF said earlier this month that it can keep supporting Ukraine even if it stops servicing debt held by private bondholders.

Goldman Sees Ukraine in Solvency Crisis, Likely Default in July

Ukraine is facing a solvency and liquidity crisis and will likely miss a bond coupon payment next month and default on its debt, according to Goldman Sachs Group Inc.

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Jun 25, 2015 19:02 (GMT)

Despite the fact that Ukraine will likely fail to repay its private investors in July, the Ukrainian government has thus far continued to pay the Russian government, despite the war in eastern Ukraine. Business Insider reports:

“[Earlier this month], we paid $39 million (34 million euros) for (US-held) Eurobonds, and we will also pay $75 million to cover the so-called Russian bonds,” Finance Minister Natalie Jaresko told reporters.

Her office quickly stressed in a separate statement that a faster-than-feared economic implosion left Kiev with no alternative but to freeze its payments “unless a negotiated solution is found in the weeks to come.”

James Miller

A ‘Big War’ On The Horizon? Separatists and NATO Warn of Escalation

Alexander Borodai, the former leader of the self-declared “Donetsk People’s Republic,” has warned that the Minsk peace process is not likely to solve the crisis and a “big war” could soon break out which involves Russia. Reuters reports:

“To be honest, I expect that the Minsk 2 agreements will not be observed, in the same manner as the Minsk 1 agreements were not,” Borodai said in an interview this week in a Moscow restaurant surrounded by former rebel commanders.

“And at the end of the day the Ukrainian army will launch an offensive. This is a very probable development … I am not sure that it will end without a big war, as Russia cannot tolerate this sore on its borders forever.”

“A big offensive by the Ukrainian troops will mean many casualties among civilians, I am sorry, as well as among the military … One cannot say Russia doesn’t care about Donbass people. Therefore there is a chance Russia won’t leave people in the (rebel-led) republics in need,” he said.

Though Borodai is no longer the prime minister of the DPR, he is still considered a leader there, and his replacement, Aleksandr Zakharchenko, has repeatedly made militant statements rejecting the Minsk deal. 

Meanwhile, NATO has also warned that heavy fighting could soon return to Ukraine. AP reports:

NATO says there’s a risk of a return to heavy fighting this summer in eastern Ukraine, and is blaming Russia.

NATO Secretary-General Jens Stoltenberg said Thursday Russia continues to support pro-Moscow separatists “with training, weapons and soldiers.”

He said the Russian military also has stationed “large numbers of forces” on the border with Ukraine.

James Miller

No Ukrainian Troops Killed In 48 Hours

Here is the map of the latest fighting, released by the Ukrainian National Security and Defense Council. 


On the surface, there appears to be significantly less fighting than there has been all month, and the NSDC reports that for the second day in a row there were no fatalities reported within the Ukrainian military.

Below is a video of all of the NSDC maps from the last two months, compressed into one minute.  

Following up on our analysis yesterday, there are a few important trends to watch for:

1) Notice the general trend that the amount of incidents reported by the NSDC, the amount of “flames”, expand both in number and in affected territory.

2) Pay close attention to how the flames jump around. Though certain areas are under near-constant attack, other areas are sporadically under attack. The front line, then, is constantly rotating. This conforms to our theory that the Russian-backed fighters continue to shift their attacks, probing many areas at once, then shifting attacks to nearby areas, all the while plunging “fingers” deeper into Ukrainian territory in the process. 

3) For all of the fighting near Donetsk, notice the large amounts of fighting between Donetsk and Mariupol, near Gorlovka, and north of Lugansk. Mariupol and Donetsk continue to grab international headlines, but the fighting on these other fronts may be far more important, strategically, to the Russian-backed fighters.

4) There is a noticeable explosion in violence after the May 9 Victory Day celebration, and again after the June 3 assault on Marinka. In fact, today may be the lowest levels of reported violence since those events.

But the map only tells part of the story. The NSDC reports: 

The report from Shirokino, east of Mariupol, is interesting. It follows another trend we’re witnessing — less intense fighting, but more long-range artillery strikes. 

The OSCE has also seen less fighting near Shirokino. This development also comes on the heels of a report from journalist Oliver Carroll, who embedded with Russian-backed separatists in the town. According to Carroll, the separatist forces on the front lines appeared to be “a motley mix of locals, mercenaries and Russians. Few of the privates seemed to be regular army soldiers.” The scene did not resemble others which Carroll had witnessed, where the Russian military was taking a more direct role.

See that report here: 

The UK’s Channel 4 has also recently visited Shirokino and interviewed soldiers on both sides. Channel 4 spends the majority of the time trailing a single separatist fighter and a single Ukrainian soldier, visiting them on both the front lines and on their visits home. The video gives an excellent insight into the true human side of this conflict. Channel 4 describes the conflict as a “civil war,” a description some will take exception to since the term assumes that there would be a war if there Russian government had not interfered. 

Ukraine: fighting on both sides of the front line

18 months into the civil war in Ukraine and there is no end in sight, writes filmmaker Patrick Wells. I spent three weeks filming on both sides of the front lines outside the strategic southern port of Mariupol – a vast industrial city that's the gateway to Crimea.

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Jun 25, 2015 17:59 (GMT)

In that video, one does not get the impression that this is the main front, a battle where either side is in a position to capture significant territory and ultimately end the fighting (and the nightmare in which civilians in this area live every day). 

Elsewhere in Ukraine, however — particularly in Lugansk region and just south of Donetsk — the fighting is raging far more intensively.

James Miller