Ukraine Live Day 290: Ukrainian and Russian Currencies Are Fastest Dropping in the World

December 4, 2014
Currency Exchange in Kiev. Photo by Volodymyr Petrov

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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View Ukraine: April, 2014 in a larger map
For links to individual updates click on the timestamps.

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

Below we will be making regular updates so check back often.


Commander of Russian-Backed Rebels Admits Firing Rockets From Civilian Neighborhoods

Regular readers know that we have documented many examples of Russian-backed rebels using civilians as human shields, particularly in Donetsk. This week we documented a series of Grad rocket attacks from launchers which were positioned right across the street from a set of high-rise apartment buildings.

Now, a prominent commander of the Russian-backed rebels admits that rockets have been fired from residential neighborhoods. AP reports:

Vostok Battalion commander Alexander Khodakovsky said fighters using residential neighborhoods as for cover for shelling attacks will now face arrest, but he denied that the practice was commonplace.

“If there are one-off instances, believe me when I say that we will tackle this very strongly,” Khodakovsky said.

This is not the first time that Russian-backed rebels have admitted using the people of Donetsk as human shields:

Khodakovsky also made an interesting comment which perhaps explains
why there has been no truce — he said that Ukrainian troops should
abandon Donetsk International Airport:

Khodakovsky accused the government of failing to keep its side of the bargain by constantly resupplying the airport troops.

“For all combat operations to end, the garrison there should abandon the positions that they hold,” he said.

This was never a demand which Ukraine has agreed to. In fact
despite the fact that Ukrainian President Petro Poroshenko has just said
that a new ceasefire will start on December 9, more Ukrainian troops
arrived at the airport today. To our knowledge this is the first time
such a demand has been made. In accordance with the Mink agreements, all
heavy artillery was supposed to be pulled back by the Ukrainian
military, and all evidence we’ve seen suggests that they have complied
with this, but none of the ceasefire deals made arrangements for the
repositioning of other forces.

Ukraine is not likely to accept this demand. This means that even as a new ceasefire, starting December 9, is being announced, it already looks doomed to fail.

Mounting Concern About Ukraine’s New Proposed ‘Ministry of Information’

This week Ukraine’s Verkhovna Rada (parliament) has sworn in a new set of government ministers, and one of them is catching plenty of criticism. Yuri Stets is slated to be the head of the proposed Ministry of Information Policy in order to combat disinformation coming out of the Kremlin. As we noted on December 2, many journalists immediately took to the streets or expressed their concerns about this development online.

Today Agnieszka Piasecka takes a closer look at this new proposed ministry for Kyiv Post in an article that starts with the following statement: “Ukraine lacks an informational strategy rather than an informational ministry and the Ukrainian authorities seem to continuously confuse one with the other.”

The article goes on to point out several particular articles in the proposed legislature that are particularly alarming and could allow the ministry to take direct control of the media. But the article goes beyond that to point out that the Ukrainian government has no idea how to disseminate information:

Of course, there is a lack of a consistent informational policy inside and across the government agencies and there is widespread incompetence. It is typical to take several days to reach a press secretary of a government agency or ministry for a commentary, the contact details of such press officers are more secret than sensitive national security data, and press releases on the key issues of public interest are non-existent, or late and lack specifics. The state needs a unified information policy regarding nation branding, state image, and response to domestic and foreign criticism. Ukraine also needs to fight for the minds of those in the East of Ukraine and counteract the Russia’s attempts to confuse the West about the situation in Ukraine.

Yet, there is a simple solution. If you want to have a good information policy for a governmental agency, hire a good PR company, design a professional website, set up social network accounts, create a hot-line, and make sure your secretary actually answer your emails. The informational policy on the national level can and should be implemented by the Ministry of Foreign Affairs, Institute of National Remembrance or any other government body. These bodies can fight misrepresentations and propaganda in courts, can prepare press releases their interpretations of the events, and serve the public with the facts that prove the informational enemy false.

Read the entire article here.

Poroshenko Announces Ceasefire Will Start December 9 In Accordance with Minsk Deal

RFE/RL reports that a new ceasefire has been agreed upon which will go into effect on December 9:

Ukrainian President Petro Poroshenko said on December 4 that the terms of the new cease-fire were included in an earlier peace deal agreed with the help of European representatives in the Belarusian capital, Minsk, on September 5.

But the Minsk agreement published at the time made no mention of a specific date on which the two sides were due to lay down their arms.

Andrei Purgin, the self-styled parliament speaker of the self-declared Donetsk People’s Republic, confirmed that the cease-fire was part of the Minsk deal.

Pictures Of The Ukrainian Soldiers On The Front Lines Of Combat In Donetsk

Journalist David Patrikarakos is back in Ukraine and is embedded with the Ukrainian military as the fighting intensifies. Patrikarakos traveled all the way to Donetsk Airport, so his behind-the-scenes reporting is providing good insight into what has become the focal point of so much fighting.

He has tweeted many pictures today, but we’ll highlight a few.

Patrikarakos has several tweets about one enthusiastic soldier who wanted to pose for several pictures while waving a Ukrainian flag and dancing to celebrate as supplies reach the front lines in Donetsk:
But it’s not all fun and games:
John Kerry And Sergei Lavrov Face Off At OSCE Conference

As we reported earlier, US Secretary of State John Kerry told the OSCE today that hundreds of Russian soldiers have crossed into Ukraine and have been killed. Those comments, and others, were delivered by Kerry right before me met with Russian Foreign Minister Sergei Lavrov. The New York Times reports:

“Regrettably, Russia continues to supply new weapons and increase support for armed separatists,” Mr. Kerry said in Basel at a meeting of the Organization for Security and Cooperation in Europe, which has sent teams to Ukraine to monitor a shaky cease-fire. “In doing so, it fails to meet its international and O.S.C.E. obligations and to live up to an agreement that it actually negotiated and signed.”

He added, “The result is damage to its credibility, and its own citizens wind up paying a steep economic and human price, including the price of hundreds of Russian soldiers who fight and die in a country where they had and have no right to be.”

Lavrov made his own comments, echoing Moscow’s line that what happened in Kiev was an “anti-constitutional coup d’état.” Then he met John Kerry:

Mr. Lavrov declined to respond to Mr. Kerry’s allegation about Russian military casualties when the two diplomats shook hands at the start of the meeting.

“This is not a press conference,” Mr. Lavrov said in response to a question from a reporter. “I heard what you said.”

On the surface, this is perhaps the strongest direct confrontation between Kerry and Lavrov to our memory. While in the US Ambassador to the United Nations Samantha Power has been very firm with her Russian analogue Vitaly Churkin, Kerry has been more diplomatic. This is possibly a sign that the White House is growing weary of Russian broken promises on the issue of Ukraine.

But as anyone who has been watching this conflict knows, it’s not clear
that the US is preparing to change its course of action. Kerry is still
pushing the Minsk agreements as the best solution to this crisis.

Lavrov, for his part, is also insisting that the Minsk accords are the best way forward. Lavrov insisted, however, that Ukraine directly negotiate with the Russian-backed separatist leaders of the self-proclaimed Donetsk and Lugansk ‘People’s Republics.’ Lavrov also clarified, perhaps, who negotiated this “truce” in Donetsk — Russian military advisors. The Russian state news agency TASS reports:

Lavrov said that “today all hopes are pinned on the implementation of the Minsk agreements between the authorities in Kiev and the representatives of Donetsk and Luhansk, actively promoted by Russia and the OSCE.”

“Our military experts, invited by President Petro Poroshenko, are providing assistance to the conflicting partiers to complete the coordination of the disengagement line and practical steps for the pullout of heavy weapons, which will make it possible to deploy the observers of an OSCE special monitoring mission between the positions of the two sides,” he said…

“Russia systematically supports the Minsk process and wants it to be continued. Attempts to convert the talks into other formats excluding representatives from Donetsk and Luhansk are unacceptable,” Lavrov said. “Only a direct dialogue between the Ukrainian parties can yield results. It should not be permitted the Minsk Accords have the same plight as the February 21 agreement and the Geneva Statement.

Lavrov believes that an honest and transparent investigation of all crimes, including the tragedies of Maidan, Odessa and Mariupol and the Malaysian Boeing disaster will have special importance for restoring trust and for national reconciliation.

James Miller

Ukraine Says It’s Battling Russian Forces As Record Amount Of Grad Rockets Launched By Russian-Backed Fighters
The situation is escalating rapidly in eastern Ukraine:
This tallies with our observations — more artillery and Grad rockets are being spotted on the roads than ever before, and the amount of shelling in a few select areas is as or more intense than ever.
This is another escalation. Ukraine is now reporting that it’s openly fighting the Russian military on the border? In the past Ukraine has been hesitant to make such claims. In fact, in August it took more than a month of intense escalation before Ukraine officially declared that Russia invaded. Then it walked back the claims. And when video surfaced in late August which appeared to show helicopters or slow-flying jets sinking a Ukrainian military ship, Ukraine denied any Russian involvement and said that the ship was sunk by tank fire.
James Miller
Ukraine Says 300 Russian Regular Troops Killed In Fight For Donetsk Airport

Kyiv Post reports that according to Oleksandr Rozmaznin, the head of the Ukrainian Armed Forces personnel department, the Ukrainian military has intercepted communications from the Russian military which indicate that 299 Russian soldiers have been killed in the battle for Donetsk airport and nearly 200 others have been injured:

He said that southern units were involved in the clashes, in particular, the 16th special purpose brigade of the Main Intelligence Directorate of the Russian General Staff [GRU – The Interpreter], the 200th special purpose brigade of the Southern Military District (Rostov), a motorized infantry battalion and a tank company of the 4th Kantemirovskaya separate guards tank brigade, a battalion of the 22th separate brigade of the Main Intelligence Directorate of the Russian General Staff, and an assault company of the 106th guards airborne division.

The Ukrainian government has been saying for some time that Russian military units were directly involved in fighting at the airport. Censor.net.ua  has released a picture of a leaked document which reportedly details Russian losses.

There are two general questions which need answering: are Russian troops involved in the fight for Donetsk airport, and if so are these numbers realistic?

US Secretary of State John Kerry made remarks today at a meeting of the Organization for Security and Cooperation in Europe (OSCE) in Switzerland that the US believes Russian troops are fighting and dying in Ukraine. Associated Press reports:

In his opening remarks, Kerry publicly cited “hundreds of Russian soldiers who fight and die” in Ukraine – alluding to what the U.S. says is proof of Moscow’s direct involvement in the fighting. U.S. officials believe an estimated 400 Russian troops have been killed in Ukraine this year.

We’ve certainly seen evidence of an intensifying attack on Donetsk Airport, with substantial use of artillery and rockets. These weapons take training to use, and perhaps a substantial amount of the weapons used against the airport were supplied by the Russian military, so if anything the claim that Russian troops are assaulting the airport may be the least controversial of the claims Rozmaznin is making here.

But were 300 soldiers really killed in this battle? No Ukrainian combat unit is more feared by the separatists or honored by the pro-Ukrainians as the “cyborgs” who are defending the airport. Keep in mind that video feeds and press reports almost exclusively view this battle from the point of view of the separatists because it’s easier, and far less dangerous, to get to their front lines than Ukrainian military positions in Donetsk. We know that attacks on the airport are relentless and intense, and we also know that they’ve been unsuccessful for months.

On the other hand, reporters who have been to the airport have seen a resilient and elite group of fighters who have weathered this storm. It’s reasonable to guess, then, that separatist and/or Russian casualties may be significantly higher than Ukrainian casualties in this battle. And Ukraine has suffered many dozens of casualties since the siege of the airport began in September.

In other words, that number may be on the high side, but it may not be an unreasonable estimation of total anti-Ukrainian loses. But Russian forces are supporting separatist units, and this claim is specific — 300 Russian soldiers have been killed. That strikes us as high, though if one counts all the fighting in the greater-Donetsk area, that may be a more realistic number. At this point, however, there’s just no way for us to corroborate such a claim.

The Russian government continues to deny that any Russian soldiers have been killed in Ukraine, despite efforts of NGOs and journalists who have documented the funerals for fallen soldiers.

One thing is clear — so far the cyborgs are winning decisively, and the Russian-backed militants appear to know it, which is one likely reason why there is a surge in artillery and rocket barrages in northwest Donetsk. 

James Miller

To No One’s Surprise, Shelling Continues In Donetsk Despite ‘Truce’

A new “truce” is two days old in Donetsk… but this truce is even less real than the constantly-broken ceasefire which was brokered at the end of August. Since the truce was supposed to go into effect things have not slowed down one bit in Donetsk. In fact, it seems the shelling has only intensified.

This report from the ground is 8 hours old:

And this is an hour old:

The lack of a ceasefire should surprise no one. A more interesting development, however, was that yesterday Kristina Jovanovski said she spoke to leaders of the self-proclaimed Donetsk People’s Republic who said that while they were aware of the negotiations, they do not know who negotiated the new truce. Ukraine had previously stated that the truce was hammered out with representatives of Russia.

All of this begs many questions:

– Did the Russian-backed separatists even really agree to a truce if they have no direct representation at the table?

– If Russia is negotiating on their behalf, then why aren’t they abiding by the ceasefire? Is it because Russia does not have full control over these militants which they’re arming, or is it because Russia does not want a ceasefire?

– How can anyone suggest that a diplomatic solution can be reached if the Russian-backed militants never follow through on the deals which have been agreed upon?

– Will Ukraine give up on the ceasefire and relaunch their “anti-terror operation” (ATO) to retake the Donbass?

– What happens if they do relaunch the ATO?

James Miller

Russian and Ukrainian Currencies The Worst in the World

The Ukrainian hryvnia is falling as fast as the ruble, and both currencies are falling faster than any other currency in the world, RBC and Unian report.

The ruble has lost 40% of its value compared to the dollar, and the hryvnia has lost 46% this year.

The hryvnia is at 15.04 to the dollar, and has fallen 46 points since January; the Russian ruble is at about 53.8 today and has fallen 39 points since January.

Both Ukrainian and Russian currencies have dropped more than the Ghanaian cedi, which has fallen 26 points and is at 3 to the dollar

Even the Syrian pound has done better than the ruble or hryvnia, falling only 19 points, currently at 175 to the dollar.

As recently as September, the hryvnia was selling for about 8 per dollar, Censor.net reported.

Kyiv Post reported three weeks ago that the National Bank held an emergency meeting on November 10 to agree not to let the hryvnia slip below 16, and it has held, but is weakened by the war.

Valeriya
Gontareva, head of Ukraine’s central bank, has all the reasons to reiterate her
popular saying that the country’s financial system is like a terribly sick person
who’s got an open wound and is bleeding.

The national currency, hryvnia, has declined in value by 47 percent since January, reaching 15.5 to the U.S. dollar
during the Nov. 10 trading session on the interbank market. This reflects
banks’ high demand for hard currency as people prefer it as the best savings
option. Hryvnia deposit
rates have reached 28 percent
in some banks, though many still feel it’s better to
invest in U.S. currency in times of economic crisis caused by war in the east.

The hryvnia has steadied itself in the last 20 days, however.  Over that same period the ruble has dropped significantly.