Politics

Here’s what the West should do about Ukraine

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People on Kyiv's Independence Square on Wednesday listen to nominations of candidates for the new interim cabinet. Opposition leader Arseniy Yatsenyuk was named as the candidate for prime minister.

Credit:

Louisa Gouliamaki

LISBON, Portugal — Here's the simple view of what Western countries should do to help Ukraine.

First, the European Union can team up with the International Monetary Fund, the United States and other donors to provide emergency aid and a bailout package — Ukraine says it needs up to $35 billion over the next two years — to drag the country from the brink of bankruptcy.

At the same time, the West should launch a diplomatic offensive to deter Russian President Vladimir Putin from intervening in Russia’s southern neighbor by assuring him Moscow's interests won’t be threatened by Ukraine's new direction.

The Ukrainian authorities should be pressed on democratic standards, minority rights and the importance of avoiding a witch hunt against supporters of the ousted regime.

The wide-ranging trade and partnership deal with the EU that then-President Viktor Yanukovych vetoed under Russian pressure in November should be quickly revived to open Western opportunities for Ukraine's economy.

Last, there's the question of giving Ukraine long-term hope for EU membership — working toward that goal would require the country to develop strong democratic institutions, an independent judiciary and a functioning market economy.

Straightforward enough? A few minutes listening to Wednesday's debate on Ukraine in the European Parliament in Strasbourg, France, would be enough to dispel any illusions.

Polish members demanding the EU offer Ukraine membership clashed with Finns claiming that would be premature and dangerously illusionary.

British conservatives appealed for immediate aid, while Dutch far-rightists warned against helping any new authorities who have anti-Semites in their midst.

"Financial support is vital," argued Laima Andrikiene, a center-right member from Lithuania. "The time of condolences, sympathy and promises are over, we need to help Ukraine to the full."

Meanwhile, EU foreign policy chief Catherine Ashton today called a high-level meeting to discuss support for Ukraine.

European officials are also holding urgent talks with the International Monetary Fund on putting together an aid package that would bolster Ukraine's frighteningly low reserves and ensure government officials are paid.

British Foreign Secretary William Hague was at IMF headquarters Wednesday. His German counterpart Frank-Walter Steinmeier is scheduled to follow him on Thursday to discuss the new Ukrainian government's appeal for the $35 billion.

Although big European donors such as Germany are suffering from bailout fatigue after five years of euro zone crisis, a package that size is within the means of the IMF and EU working together.

The problem is that in return for handing over the money, they will demand that Ukraine knock its economy into shape.

"Essential Ukraine embraces major economic reforms in return for international support," Hague tweeted after his "very useful meeting with IMF."

Even in stable EU democracies such as Greece, the pain from such reforms has caused widespread unrest. In Ukraine, a dose of IMF-induced austerity — which would be likely to include public spending cuts, slashing state aid to industry and removing fuel subsidies — would risk adding to already seething tensions.

"The Ukrainian economy has a number of really fundamental distorting factors ... sooner or later these issues will need to be addressed," says Sir Michael Leigh, senior adviser to the German Marshall Fund of the United States.

"Obviously in the course of negotiations, some sensitivity will have to be shown to the repercussions for the Ukrainian economy and the Ukrainian people," he said from Brussels.

The last time the IMF agreed to help — with $15 billion in 2010 — the money was frozen because Ukraine failed to implement the required reforms.

The pain from reforms could be mitigated by implementation of the trade and cooperation agreements that should have been signed with the EU in November. It was Yanukovych's decision to drop them that prompted the wave of demonstrations against him.

The deals were designed to boost the economy by opening up European markets, but also offered other advantages such as increased freedom for Ukrainians to travel — a major factor for many of the young people who spearheaded the protests and are keen to study, work or vacation in the West.

EU officials say the November deals remain on the table, but that signing could depend on the formation of a stable government in Kyiv — perhaps only after the elections scheduled for May.

EU membership is another matter. In the group’s former-Communist east, there’s widespread support for Ukraine to be offered a clear "perspective" of joining even if the country remains years away from meeting the conditions for even starting membership negotiations.

Jacek Saryusz-Wolski, a Polish member of the European Parliament, said Wednesday it would be shameful if the EU fails to recognize Ukraine's membership prospects after "a popular uprising started under European flags, and people fighting and dying under those flags."

Others fear such a move would risk creating false hopes given that Ukraine remains so far from attaining the required political, judicial and economic standards.

"There needs to be a far-going process of political and economic and structural reform before Ukraine will be anywhere near meeting those criteria," said Leigh, a former head of the EU department dealing with the entry of new member countries.

More from GlobalPost: Opposition leader Arseny Yatsenyuk is nominated as the candidate for Ukraine's next premier (LIVE BLOG)

A pronouncement on EU membership at this stage would also needlessly risk provoking Russian sensitivities, Leigh added. "It clearly is not the moment to be giving that kind of signal," he said.

Russian action could make any Western support for Ukraine much more difficult — even without dreaded military intervention.

A $15 billion Russian bailout offered to Yanukovych is now unlikely to materialize.

Moscow could impose sanctions on a country it says is in the hands of dangerous usurpers. Russia is the largest market for Ukrainian exports, while oil and gas pumped from Russian fields are vital for heating Ukraine's homes and powering its factories.

In Brussels on Wednesday, NATO defense ministers warned Russia against trying to break up Ukraine. "NATO allies will continue to support Ukrainian sovereignty and independence, territorial integrity, democratic development, and the principle of inviolability of frontiers," they said in a statement.

However, Western diplomats are aware they need to offer Putin a face-saving solution following the humiliating flight of his Ukrainian ally that would somehow help Kyiv maintain amicable relations with Russia even as it builds stronger ties with the West.