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EU Offers Conditional "Aid" For Ukraine's "Catastrophic, Pre-Default" Economic State
"There is no money in Ukraine's Treasury account," exclaimed 'Interim President' Oleksandr Turchynov to the Ukrainian parliament; adding that the Ukraine economy is in a "catastrophic state."
- *THERE ARE PROBLEMS WITH BANKING SYSTEM AND HRYVNIA: TURCHYNOV
- *PROBLEMS WITH PENSION FUND ARE "COLOSSAL": TURCHYNOV
- *UKRAINE'S ECONOMY IS IN A `PRE-DEFAULT' SITUATION: TURCHYNOV
Hardly surprising given the months of protest; but with Russia 'conditionally' postponing its EUR2bn 'loan', the Europeans are riding to the nation's aid with promises of EUR20bn (if Ukrainian authorities meet certain conditions). But, as the map below shows, a great deal of the nation's wealth lies in the eastern (pro-Russia) region.
- *NEW UKRAINE GOVT'S PRIORITY IS TO RETURN TO EU PATH: TURCHYNOV
- *RUSSIA SHOULD RECOGNIZE UKRAINE'S EUROPEAN CHOICE: TURCHYNOV
Russia is on hold but the Europeans are willing... conditionally...
The European Commission has said it is ready to conclude a trade deal with and offer aid to Ukraine once a new government is in place in Kiev, Reuters reported Feb. 23. An EU official added that the European bloc could give the country more than 20 billion euros (some $27 billion) if Ukrainian authorities meet certain conditions, The Wall Street Journal reported. According to the official, this figure is a conservative estimate of the potential assistance Ukraine could receive from EU members. Russia is currently holding out on economic aid to Ukraine as it waits to see how the country's political crisis plays out.
But as a reminder, a great deal of the nation's wealth resides in non-pro-Europe eastern Ukraine...
The Economic Consequences of Ukrainian Federalism (via Stratfor)
For a country like Ukraine, the appeal of federalism, which divides authority between the central government and its constituent regions, is undeniable. Located in Europe's borderlands, Ukraine has been contested by its neighbors for centuries, a competition that has left it internally divided along linguistic, cultural and religious lines. Broadly speaking, Ukraine is divided between the east and the west, with eastern Ukraine favoring Russia and western Ukraine favoring Europe. Ukraine's regions are also distinct economically. The country's industrial base is located in the east. The east's close proximity to Russia creates strong cross-border trade that enriches regional economies. According to Ukraine's government statistics service, manufacturing contributes at least three times more than agriculture to the country's gross domestic product. Thus, eastern regions generally have higher per capita GDP rates. In 2011, the per capita GDP in the eastern region of Dnipropetrovsk, the country's most important industrial center, was 42,068 Ukrainian hryvnia ($4,748), while it was only 20,490 hryvnia ($2,312) in Lviv region, which is one of western Ukraine's industrial centers.
Seven of Ukraine's 10 largest private companies by revenue are either headquartered or maintain the majority of their operations in eastern Ukraine. These firms are owned by some of Ukraine's wealthiest and most influential individuals. Three of these 10 corporations -- mining and steel company Metinvest, energy firm DTEK and its subsidiary Donetskstal -- are based in the eastern industrial city of Donetsk and are owned by Ukraine's wealthiest man, Rinat Akhmetov. Interpipe, the company that controls 10 percent of the world market share of railway wheels and more than 11 percent of the world market share of manganese ferroalloys, is based in Dnipropetrovsk and belongs to businessman and politician Victor Pinchuk.
The country's most important businessmen are embedded in the east, where their businesses make disproportionately high contributions to the Ukrainian economy and national budget. Westerners staunchly oppose federalism because they believe it would threaten their economic and security interests. Others believe it could dissolve Ukraine as a country, leaving the west weak and defenseless against the Russia-backed east. Whether or not these concerns are misplaced, federalism would in fact benefit eastern regions disproportionately by giving them more control over state revenue, aggravating the socioeconomic tensions between the regions.
However, the Ukrainians are keeping their options open...
- *`WE ARE READY TO HAVE A DIALOG WITH RUSSIA:' TURCHYNOV
- *UKRAINE TIES WITH RUSSIA SHOULD BE ON EQUAL FOOTING: TURCHYNOV
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On cue, soon as their goon is safely out of Ukraine, it's time for an emergency EU bailout to save us from ourselves!
Why doesn't Martin Hamstrung consult his Commodore C64 and predict what happens next ? 2014.8 1/2 anyone ?
look up John Titor this is how he says WWIII starts. He says a NATO arms goes east which forces Russia to nuke the US, China, and Europe
"The attack on Europe is in response to a unified European army that masses and moves East from Germany"
John Titor, one of the most entertaining Internet hoaxes.
Spend much time in fantasy land?
A unified European army that masses in Germany to move against Russia? HaHaHa. That is some funny shit right there. I assume they will mass quickly in the summer months when they don't need quite so much energy.
One other little thing about modern warfare....any force that "masses" anywhere within range of an ICBM will quiclkly become a "former force".
Not in August. Europe is on vacation. Think fall for massing and winter for invading. That always works out well...
Cue building tanks and bullets in Detroit. Calling the UAW to become the UTW or united tank workers union. If we build it they will use it. Moar Woar!!!!!! It is coming. Small trouble though building tanks requires people who can read and show up for work on time. that might be a bit of a problem this time around.
The Germans can automate that factory.
No need for any Brothers to bother showing up.
actually Putin had worked well with Timoshenko (ukrain iron lady who is just out of prison) before and they will have good deals in the future
Ukraine, Syria And Global De-Dollarization: USD To Go Down And Gold Up
What is connecting so different countries as Ukraine and Syria? The big chess game played by the U.S. and Russia. Syria needs to be "liberalised" in order to build pipelines for the natural Gas to be supplied from Qatar to Europe. Russia and China have blocked that game and they have Ukraine revolution 2.0 now. Putin's dream is to rebuild USSR as the Eurasian Union and Ukraine is the key to his success. He will not back out of it easily. One thing is an insult in the ice hockey defeat by the U.S. in Sochi and another thing is to lose "Small Russia". On the map below you can see why Ukraine is so important geopolitically, it is all about Energy again. Key supply natural Gas routes from Russia to Europe are crossing this country.
We do hope that Ukraine will not ignite the real war, but you can be assured about the asymmetrical moves with the heavy weaponry of The Financial War. Here where we are coming to the ongoing flight of physical Gold from the West to the East and the coming De-Dollarisation. Democracy - so well presented by Netflex with its "House of Cards' production - meets countries with the special destiny, where elites are not hiring actors to read teleprompters, but making all the dirty work by themselves. Ukraine will be the very bad example for these leaders: that you can come, make a few phone calls and even f**k the EU deciding who will lead the sovereign country next. The least they can do is to accelerate the De-Dollarization and call the bluff called the "food stamp recovery and Taper". US Dollar is levitating just above crucial 80.00 level, with all Taper hype and currency distractions in the emerging markets. Gold is breaking to the upside and any additional strain on the U.S. "recovery" can ignite the next leg down in US Dollar. China will be playing its own game getting ready to the global reset: accumulating record amount of Gold and encouraging its citizens to do the same. http://sufiy.blogspot.co.uk/2014/02/ukraine-syria-and-global-de.html#
The EU is offering conditional aid to address Ukraine's perilous financial situation? Why, yes, I'm sure they are. I'm sure Ukraine could qualify for Eurozone membership under Maastricht if they just offset 200% of their debts with these Interest Rate Swaps, agree to exponentially increase domestic taxes on income earned from labor, "bail-in" all public pensions, knock a zero off of public employee salaries, eliminate corporate taxes and restraints on capital flows, and remove any regulations of transnational banking and foreign asset ownership.
And Ukraine will become a nirvana, just like Latvia, Portugal, Ireland, Italy, Greece, Spain, Cyprus, etc. Of course anybody who opposes something like that is a Communist stooge. And so is anyone who opposes fascist paramilitaries, or doesn't trust the motivations of the US, or doesn't think global bankers have everyone else's best interests at heart. People like that tend to frequent fringe blogs and hate freedom and progress.
What? They have no money? They are broke? Oh well they will fit right into the EU then.
Bailout!!!
Problems with the banking system? How could this be?
too few supervising authorities ! They must double or triple the headcount. And increase salaries.
Here, have some debt. Just a little can't hurt. You'll like it!
Go on, just a wee bit, just 20 billion, what's the harm in that?
I know, life's hard. It'll tide you over till pay day.
Maybe the EU could offer say 250 tonns of gold as a flat line contribution to the Ukraine people for financial economic restructuring I exchange for tariff free Gasprom delivery for 20years. No they want Ukraine in civil unrest cause this deflects the greater issue's of hemodging facing western civilization and the coming derivatives "house-of-cards" collapse.
I wouldn't be surprised if the EU needs 250 tonnes of gold more than Ukraine at this point.
Debt to GDP might be worse...but US near top by that measure..
Ukraine is crazy, but I would guess their accounting more true than west..
I base that from asking economist trained Ukrainans and Russian who are sharp minds.
Ukrainian Accounting for Dummies:
Zero + Zero = Zero.
Russia should act NOW, invade with all they have. Back up the Ukraine Army and hunt down and kill foreign operatives.
Then, let the Ukranians vote on what they want with Observers to insure fair elections. The Russians can stay in the background, bolster the Ukr. forces, and let the people form a new parliament/constitution.
I can't believe Putin played the West again.
They were expecting Russian military intervention, and now they have to pay for entire Ukraine! This is hilarious... hilarious...
Putin could intervene but it's actually cheaper for him to wait.
In six months from now, Ukrainians will once again beg for Russian deals. And then the Fascists will protest again. And then they will turn to Russia again.
You get the point!
i have said many time, the state department is where
politicians go to have their reputations destroyed but
now i'm thinking this must be the department in the
federal government where the top russian spies seek
advancement.
Exactly right. Putin is in no hurry. He has all the leverage, and plenty of time to let this play out as Ukraine gets weaker by the day, and the fools that pass for leadership in the West fumble & mumble inane statements filled with hot air and no teeth.
Ukraine: The global Ping-Pong ball.
I see the situation in the east Ukraine unfolding a lot like what happened to the break away areas of Georgia. Many Russian passports will be issued to the residents, any violence or coercion against said residents will be met with Putin sending his military into the east Ukraine to protect his citizens (and military bases/national interests etc.) It is laughable that the U.S. thinks it can strong arm the Russians in their own back yard. The result will be the encouragement and support of the pro-EU/Western factions to mix it up with the pro-Russian side and the resulting chaos will result in Putin sending forces in.
As an aside, the Ukrainians are between a rock and a hard place, being under broke EU/Western bankster suzerainty bleeding them dry or under control of Russia. Personally, I would choose Russia, at least there are cultural and linguistic bonds there, most of their energy comes from Russian sources, they are Slavic peoples and these days Putin seems a lot more honest then the western power brokers. Additionally, the western Europeans have historically looked down on Russians, Poles, Ukrainians and other easterners. If I were Ukrainian I would look back to what has happened to their country in the past, being carved up among great powers and I would look at how great the Poles did over the years with their guarantees of independence with a special light on the 1939 Molotov/Ribbentrop pact. You can count on the West to speak loudly and do nothing when the rubber hits the road.
With Obama/Kerry/Rice really needing a foreign policy win and their myopic understanding of history, I can see them push this situation over the edge resulting in more bloodshed and disruption in a part of the world that has no importance to us.
I vote for Putin as well, especially if you know anything about the crap we tried to get away with under Yeltsin, the alcoholic. That's where the infamous 'oligarchs' came in handy to rape the land, the nation and its people... typical for most empires, just ask those 'Indians' we still have on human 'reservations'... "White man speak with forked tongue"... and nothing has changed since. If you don't see it coming (like the idiots in Kiev), then it will roll right over you.
www.youtu.be/qCU4C6ajgBl
F*ck the EU!
hahahahahahahahahah
Funded by American tax payers via the IMF and printed jobs/swaps by the cronies at the NY Fed (to the ECB)
Europe is f*cking disaster and should be allowed to sink.
According to Spengler, young Ukrainians want to join the EU for just one reason: So they can emigrate!
If I'm Putin I'm taking Monday off. Have a couple of drinks and think about the next move.
Have any of you seen this film "A Whisper to a Roar" that was behind the Pretty Ukrainian Girl Stanford video?
Parental Advisory ExClinton Lyrics:
http://youtu.be/U3C_FiroMas
I thought the EU was broke. Where's all this Ukrainian aid money gonna come from? Barroso's pension fund?